Paxos Securities Settlement Company became only the 8th clearing agency / central securities depository in the United States, with DLT-based clearing agency registration on an 18-month temporary basis — a detail omitted from Paxos’s announcement.
Launch expected March 2027 at earliest. Paxos uses private permissioned ledger for bilateral DvP settlement by tokenizing both securities and cash. Does not act as CCP.
Under first Trump administration Paxos received a no-action letter attracting ABN Amro, Bank of America, Nomura Instinet, and Societe Generale. Biden administration did not renew exemption when Paxos sought renewal.
Benefits: flexible settlement timing, almost instant post-settlement availability, lower margin requirements vs CCP model. Paxos Securities Settlement Company responsible for safeguarding securities and cash.