Paxos Expands USDG Stablecoin to Arbitrum with DeFi and Incentive Push

Paxos has expanded the reach of its Global Dollar (USDG) stablecoin by launching it on the Arbitrum blockchain. The move positions Arbitrum as a key platform for onchain finance and tokenization. USDG is now natively issued on Arbitrum One and integrated with several DeFi protocols, including Fluid, Morpho, GMX, and Maple. Kraken will handle deposits and withdrawals, while Stargate will facilitate transfers between Arbitrum and other blockchains.

An ArbitrumDAO proposal aims to accelerate USDG adoption by allocating 100 million ARB for incentives tied to stablecoin growth. The proposal also calls for deploying Arbitrum treasury assets to support USDG liquidity and offers assistance to businesses integrating the stablecoin. This strategy aligns ecosystem spending with stablecoin usage, potentially increasing trading volume, lending demand, and other onchain financial activities on Arbitrum.

Arbitrum already holds about $4 billion in stablecoins, and USDG ranks seventh by market capitalization with roughly $3.09 billion in circulation. Most of USDG’s supply is currently concentrated on X Layer, Robinhood Chain, and Solana. The launch on Arbitrum could expand liquidity distribution across chains or capture incremental usage. As a Global Dollar Network partner, Arbitrum will receive rewards from USDG activity, directing proceeds toward adoption and ecosystem development.

The broader push for tokenization is evident with projects like Robinhood Chain, which targets real-world and digital assets. Standard Chartered has forecasted that tokenized assets could reach $4 trillion by the end of 2028. Stablecoins like USDG are essential for tokenized financial products, reinforcing Arbitrum’s role as a hub for onchain finance.