Pax Dollar: what is it, how to buy it and how much does it cost?

Learn more about the Pax Dollar cryptocurrency and its main features

The Pax Dollar is a type of digital currency that relies on the transparency and capabilities of blockchain technology.

It is not as well-known as Bitcoin (BTC) and Ethereum (ETH). In addition, it has some different characteristics than the most well-known cryptocurrencies on the market.

And if you want to better understand how this digital currency works, continue reading. We will explain everything about it.

What is a stablecoin?

Before you know what a Pax Dollar is, you need to know exactly what a stablecoin is.

Stablecoins are a distinct class of the cryptocurrency market, as they have their own prices linked to one or more reserve assets.

In other words, they are linked to assets, such as fiat currencies (dollars, reais, etc.) and commodities (gold), for example.

Additionally, they have less volatility than other common cryptocurrencies, such as Bitcoin (BTC) itself.

What are the types of stablecoins?

Learn about the main types of stablecoins:

• Backed by fiat currency: are digital currencies backed by Fiat currencies (issued by governments or central banks).

• Backed by cryptocurrencies: As the term suggests, these stablecoins are backed by other cryptocurrencies. A good example is DAI (DAI), a more stable and decentralized cryptocurrency that operates on Ethereum (ETH). 

• Commodity-backed stablecoins: are paired with commodities. Gold is generally a commodity used in this type of stablecoin.

• Algorithmic stablecoins: They are not backed by other assets. Stability, in this case, is achieved through the use of algorithms and smart contracts on the blockchain.

What is Pax Dollar (USPD)?

Now that you know what Pax Dollar is, it's time to learn more about this asset.

Pax Dollar is a digital currency created in 2018, functioning as a stablecoin linked to the value of the dollar.

It is managed by Paxos Trust Company, Paypal's cryptocurrency partnership specializing in blockchain.

When it comes to its regulation, this digital currency is regulated by the New York State Department of Financial Services (NYSDFS), with all assets under its management insured by the FDIC.

(Source: Investor's Guide)

What is the value of the Pax Dollar?

The Pax Dollar quote is always close to US$ 1, as it is pegged to the US dollar.

This makes it less volatile than other cryptocurrencies.

For every 1 Pax Dollar issued, there is 1 dollar deposited in bank accounts, thus guaranteeing its convertibility.

How to buy Pax Dollar?

You can buy this stablecoin on a cryptocurrency exchange, which is a platform where you can buy and sell crypto assets.

Additionally, it is also possible to buy Pax Dollar and other cryptocurrencies such as Bitcoin and Ethereum on Mercado Pago.

What other currencies are available on Mercado Pago?

Pax Dollar is not the only digital currency available on Mercado Pago.

On the platform, consumers also have access to Bitcoin (BTC) and Ethereum (ETH).

See the main characteristics of each of these digital assets:

Bitcoin (BTC)

Bitcoin is the best known cryptocurrency on the market.

It is a virtual currency (the first one created) and decentralized, that is, there are no banks acting as intermediaries. It was created in 2008.

Although they are real, there is no physical version of this money.

Bitcoin emerged as a way to facilitate negotiations made over the internet.

Ethereum (ETH)

After Bitcoin, the second best-known digital currency is Ether, which was developed from the Ethereum blockchain platform.

In other words, one of the main differences between Bitcoin and Ethereum is that Bitcoin is a currency, while Ethereum is a network.

In fact, Ethereum has broader goals than Bitcoin.

The Ethereum platform was created in 2015 by Russian-Canadian programmer Vitalik Buterin.

How to buy cryptocurrencies on Mercado Pago?

At the end of last year, Mercado Pago received the functionality to buy and sell digital currencies directly through the app.

Mercado Pago is Mercado Livre's digital wallet, which offers several features to its users.

To buy Pax Dollar or other cryptocurrencies through Mercado Pago, follow these steps:

• Log in to your Mercado Pago account

• Click on “crypto” or enter the “more” menu

• Click on “buy cryptocurrencies”

• Accept the terms and conditions

• Select your desired currency (Bitcoin, Ethereum or USPD)

• Set the amount you want to spend and click “buy”

• Confirm the operation

• After confirming the operation, a screen will appear with the available balance in the chosen cryptocurrency.

How to sell cryptocurrencies on Mercado Pago?

• Log in and click “crypto”

• Click on “Sell cryptocurrencies”

• Choose the cryptocurrency and the amount you want to sell

• After that, click on “sell and continue”

• Check the details of the sales transaction

On the next screen, the details of the sales transaction will appear.

It is important to remember that the process of buying and selling available digital currencies has a fixed fee based on the total value of the transaction. 

What is the difference between cryptos and stablecoins?

There are some significant differences between the most popular cryptocurrencies and stablecoins.

The main difference is the stability of the asset. After all, the price of common cryptocurrencies varies according to the purchase and sale offer.

Stablecoins, on the other hand, have a more stable value, as they follow the flow of fiat currencies, such as the dollar, real and euro, for example.

This means that its value changes when the price of the asset to which it is linked also changes.

Regarding ballast, as you already know, these cryptocurrencies have their values linked to other assets, which is not the case with Bitcoin.

Conclusion

Now you know what Pax Dollar (USPD) is and how much it costs.

This currency is a type of stablecoin, which despite also being a cryptocurrency, has a more stable value and aims to establish parity with stores of value.

As with any other type of investment, it is essential that the investor understands exactly what the associated benefits and risks are.