A swathe of traditional finance and crypto companies, including Robinhood, Galaxy Digital, Kraken, and Paxos, have formed a consortium supporting the latest stablecoin pegged to the United States dollar.

In a Nov. 5 statement, blockchain infrastructure firm Paxos shared that the new “open network” was designed to accelerate the adoption and use of stablecoins worldwide.

“The lack of competition in the regulated stablecoin market has prevented the industry from reaching its full potential. USDG upends this dynamic with a more equitable model that will bring mainstream participants into the ecosystem and accelerate new stablecoin use cases,” said Kraken co-CEO Arjun Sethi in a statement.

The network is designed to support the global adoption of Paxos’ USDG stablecoin, launched by the firm on Nov. 1.

USDG is currently only available on the Ethereum blockchain, but Paxos said the stablecoin will be made available on other chains as regulations evolve.

Paxos will issue the USDG stablecoin out of Singapore, which the firm says is “substantively compliant” with the Monetary Authority of Singapore’s upcoming stablecoin framework, established in August 2023.

Qualified entities, including custodians, exchanges, and fintech firms will be able to join the Global Dollar Network by way of invitation.

The firm noted that the stablecoin’s US dollar backings will be reserved and managed by Singapore’s largest banking institution, DBS Bank. USDG is backed 1:1 with the US dollar in dollar deposits, short-duration US government securities, and other cash equivalents, ensuring users can redeem their tokens for fiat.

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Speaking about the launch of USDG, Paxos’ head of product Ronak Daya said the DBS partnership will enable enterprise-level stablecoin adoption.

Other digital asset offerings by Paxos include PayPal USD (PYUSD), Pax Dollar (USDP), and Pax Gold (PAXG).

The USDG stablecoin and its Global Dollar Network will launch in a market dominated largely by two major stablecoin issuers, Tether (USDT) and Circle’s USD Coin (USDC), which command respective dominance of 56% and 27% of the stablecoin supply on Ethereum, according to DefiLlama data.

USDT accounts for 69.53% of the total $84 billion supply of stablecoins on Ethereum. Source: DefiLlama