Arbitrum Joins Paxos Global Dollar Network for Reserve Income

Ethereum layer-2 network Arbitrum is integrating the Paxos-issued Global Dollar (USDG) across its decentralized finance ecosystem to earn a share of reserve income, according to CoinDesk. The initiative aims to capture a portion of the economics generated by stablecoins circulating on its network, which currently holds about $3.8 billion in stablecoin liquidity.

Ecosystem Integrations and Governance

The USDG stablecoin launched on Arbitrum with integrations across trading, lending, and payments protocols including Fluid, Morpho, GMX, Maple, Li.Fi, Gauntlet, Steakhouse, LayerZero, and Kraken, with Uniswap and Fhenix set to follow. A governance proposal published by the Arbitrum Foundation asks ArbitrumDAO to make USDG growth a strategic priority, allocate 100 million ARB to its DRIP incentive program, and deploy treasury assets to support liquidity.

Global Dollar Network Model

The Global Dollar Network operates with over 150 partners, including Robinhood, Kraken, Mastercard, and OKX, distributing rewards generated by USDG reserves among participants that drive adoption rather than leaving the economics solely with the issuer. Currently, Circle's USDC accounts for roughly 60% of the $3.8 billion in stablecoins on Arbitrum, a network where issuers previously retained all reserve revenue.

Key facts

• Arbitrum joined the Paxos-led Global Dollar Network to earn a share of USDG reserve income.
• USDG launched on Arbitrum with integrations across Fluid, Morpho, GMX, Maple, and other protocols.
• Arbitrum holds approximately $3.8 billion in stablecoins, with USDC accounting for about 60%.
• A governance proposal asks ArbitrumDAO to allocate 100 million ARB to the DRIP incentive program.