Pax Dollar (USDP) Review

Pax Dollar (USDP) scores 8.8 out of 10 in our stablecoin ratings, up from 8.4. That ties it with PayPal USD and Ripple USD, and under the site's alphabetical tie rule it is listed third of ten, behind Gemini Dollar and USD Coin. Its federally chartered issuer earns a 10 on regulatory oversight, and three more criteria score 9: monthly reserve examinations by KPMG LLP, free 1:1 redemption for verified customers and a plainly described cash-and-equivalents reserve. Custody is the exception at 7, because the banks holding the reserve are not named. The basis is desk research of Paxos's USDP page and transparency page, the KPMG-examined report for September 2026 and Paxos's stablecoin terms, rechecked on 1 November 2026.

How USDP scores in stablecoins

The category uses five criteria, each marked 0 to 10 and each worth one fifth of the total, as set out in our ratings methodology.

The arithmetic is a plain average: (9 + 10 + 9 + 7 + 9) / 5 = 44 / 5 = 8.8. No criterion is weighted more than another and no penalty is applied.

Changes from the previous scoring: custody and segregation rose from 6 to 7. The KPMG-examined report states that the reserve sits in segregated, unencumbered accounts held on behalf of USDP holders, and Paxos describes those accounts as bankruptcy-remote. That is the basis on which PayPal USD, issued by the same company, holds a 7. Regulatory oversight rose from 9 to 10 under the category's scale rule of 2 November 2026, which gives 10 to an issuer that is itself chartered and supervised as a bank or trust company by a US prudential regulator; Paxos Trust Company, N.A. is an OCC-supervised national trust bank. The overall score moves from 8.4 to 8.8. The other three marks are unchanged.

Strongest criteria

Reserve transparency (9)

The attesting firm, which the previous review could not find, is named on Paxos's transparency page: KPMG LLP for reports posted from 28 February 2025. The September 2026 report, signed in New York on 23 October 2026, is a reasonable-assurance examination under American Institute of CPAs (AICPA) standards covering two dates, 17 and 30 September. On 30 September it shows 26,084,307 USDP outstanding (24.4 million on Ethereum, 1.7 million on Solana) against US$26,113,649 in reserves: US$14.2 million in cash and an US$11.9 million overnight repurchase agreement collateralized by Treasuries. It does not reach 10 because the repo counterparty appears only as "Bank 1 in United States", and because Paxos says it "no longer proactively provides monthly reserve reports for USDP", the self-reported composition series that PYUSD still has. The KPMG report itself now carries the asset mix, so little is lost.

Regulatory oversight (10)

The report sets out the change: Paxos Trust Company converted from a New York limited purpose trust company to a national trust bank on 12 December 2025 and is now supervised by the OCC, and it says it will be subject to the GENIUS Act framework. Because the issuer itself holds the national trust charter, the mark is 10, the same given to PYUSD from the same issuer. The record includes a 2025 settlement with New York's Department of Financial Services (NYDFS), under which Paxos paid a US$26.5 million penalty over its oversight of Binance in the BUSD program; it did not concern USDP reserves.

Redemption rights (9)

Paxos states no fee for redemptions, at 1:1, for customers with a fully verified account. Its terms add that bank fees Paxos incurs are deducted, the minimum redemption equals the customer's bank wire fee, US dollar withdrawals can take up to two days and longer for large amounts, and dormant balances are charged $2 a month after twelve months. Holders without an account exit through platforms that list USDP.

Backing model clarity (9)

Paxos describes the reserve as 100% cash and cash equivalents, and the report confirms the permitted forms: insured bank deposits, Treasury bills of three months or less, overnight repos and government money market funds. In September the reserve held only cash and repos.

Weakest criterion: custody (7)

The rise to 7 reflects the segregation and bankruptcy-remote statements. What keeps it below the 9 given to GUSD and USDC is that no bank is named: the report describes the cash only as deposits "for the benefit of authorized token holders" at US commercial banks regulated by the Federal Reserve Board. It adds that US$1.59 million of the cash on 30 September was above the US$250,000 FDIC limit, and that Paxos holds US$50 million of excess deposit insurance from its own captive insurer, Paxos Insurance Company Ltd, which does not cover every bank.

What the score does not cover

• Size and liquidity. At about 26.1 million tokens, USDP is small; market depth is not scored.
• Peg history. Not a criterion in this category.
• Contract controls. Paxos's terms allow tokens to be frozen or seized, and the Ethereum contract is upgradeable; these are outside the rubric.

For those checks, see our guide on how to assess a stablecoin.

USDP vs PayPal USD and Global Dollar

The closest comparisons are the two other Paxos-issued coins, PayPal USD (PYUSD) and Global Dollar (USDG), at 8.8 and 8.4.

USDP and PYUSD share an issuer, a supervisor and terms, so their marks match line for line. USDG, issued by Paxos's Singapore and Finnish companies, scores a point lower on oversight, because its Singapore issuer relies on a general payments licence, and a point lower on custody, because its terms do not describe the reserve as bankruptcy-remote.

Who the score suits

The rating fits readers who want a federally supervised US issuer, examined monthly reserves held in cash and overnight repos, and free redemption through a verified Paxos account. It says little about how easily USDP trades, given its small supply. This is an assessment of published documents, not a recommendation to hold USDP.