Share this article
Aleo and Paxos Labs Launch Privacy-Focused Dollar Stablecoin Aimed at Institutions
The USAD token encrypts transaction data end-to-end, aiming to enable private, programmable digital dollars.
Updated Oct 1, 2025, 1:13 p.m. Published Oct 1, 2025, 12:00 p.m.
What to know:
- Paxos Labs and the Aleo Network Foundation have launched a privacy-focused stablecoin called USAD, pegged to the U.S. dollar.
- The USAD token is built on Aleo's zero-knowledge blockchain and aims to appeal to financial institutions by encrypting wallet addresses and transaction amounts.
- The project has received backing from major investors like a16z, Coinbase Ventures, and SoftBank.
Paxos Labs and the Aleo Network Foundation are working to launch a U.S. dollar-pegged stablecoin that aims to preserve user privacy, and appeal to financial institutions, the companies said.
Unveiled on Wednesday, the USAD token was built on Aleo’s zero-knowledge (ZK) layer 1 blockchain and issued through Paxos Labs, an infrastructure provider that was incubated under Paxos, the firm behind popular stablecoins such as and the Global Dollar (USDG).
STORY CONTINUES BELOW
Don't miss another story.Subscribe to the Crypto Daybook Americas Newsletter today. See all newsletters
Stablecoins are a fast-growing class of cryptocurrencies that are increasingly considered as a cheaper, faster alternative for moving money globally. They are tokens with prices tied to fiat money like the U.S. dollar, and use blockchains to settle transactions. Interest in stablecoins has accelerated with U.S. President Donald Trump signing the GENIUS Act into law earlier this year, enacting federal standards for stablecoin issuers.
Unlike conventional stablecoins such as Tether's USDT and Circle's USDC, Aleo's stablecoin encrypts wallet addresses and transaction amounts, shielding them from public view.
That design could appeal to financial institutions wary of exposing sensitive transactions data on-chain.
"Stablecoins have proven to be one of the most powerful innovations in financial markets, and we are only scratching the surface," said Bhau Kotecha of Paxos Labs in a statement. USAD aims to "bring digital dollars into a new era where enterprises can embed money that is private, programmable and trusted from the ground up," he added.
The new token fits into The Aleo Network Foundation's focus of developing cryptographic tools that allow for programmable transfers without revealing counterparties. The project drew venture capital backing from a16z, Coinbase Ventures and SoftBank among others.
"Privacy is the missing link in blockchain adoption at scale, and with USAD we are proving it can exist in a programmable stablecoin," said Leena Im, chief operating officer at The Aleo Network Foundation. "By pairing Aleo’s technology with Paxos Labs’ issuance stack, we are taking a joint, front-door approach with enterprises to show that digital dollars can be both trusted and transparent to oversight while protecting user confidentiality."
AI Disclaimer: Parts of this article were generated with the assistance from AI tools and reviewed by our editorial team to ensure accuracy and adherence to our standards. For more information, see CoinDesk's full AI Policy.
More For You
What to know:
- As of October 2025, GoPlus has generated $4.7M in total revenue across its product lines. The GoPlus App is the primary revenue driver, contributing $2.5M (approx. 53%), followed by the SafeToken Protocol at $1.7M.
- GoPlus Intelligence's Token Security API averaged 717 million monthly calls year-to-date in 2025 , with a peak of nearly 1 billion calls in February 2025. Total blockchain-level requests, including transaction simulations, averaged an additional 350 million per month.
- Since its January 2025 launch , the $GPS token has registered over $5B in total spot volume and $10B in derivatives volume in 2025. Monthly spot volume peaked in March 2025 at over $1.1B , while derivatives volume peaked the same month at over $4B.
More For You
Pye Finance Raises $5M Seed Round Led by Variant and Coinbase Ventures
The platform aims to make locked Solana staking positions tradable via an onchain marketplace.
What to know:
- Pye Finance raised a $5 million seed round led by Variant and Coinbase Ventures, with participation from Solana Labs, Nascent and Gemini.
- The startup is building an onchain marketplace on Solana for time-locked staking positions that can be traded.
- Pye says the product targets Solana’s large pool of staked SOL, worth roughly $75 billion, and aims to give validators and stakers more flexibility over terms and reward flows.
Top Stories
