I. Project Introduction
On September 10, 2018, the New York Department of Financial Services (NYDFS) simultaneously approved two stablecoins based on Ethereum, namely Gemini Dollar and Paxos Standard. These two stablecoins are encrypted digital currencies anchored 1:1 with the US dollar. These two digital currencies will be regulated by the U.S. government, and account funds will be audited every month. If there is a problem with the account, the U.S. government can pass law enforcement. means for freezing and other operations.
Gemini Dollar is the first cryptocurrency issued by Gemini Trust Company. It is a token issued through the Ethereum blockchain, backed by the US dollar, anchored at a ratio of 1 GUSD = $1, and An independent certified public accounting firm will conduct monthly reviews and publish review reports regularly, thus ensuring the stability of fiat currency and the speed and borderless characteristics of cryptocurrency.
II. Project Background
Gemini Dollar (GUSD) is an encrypted token, which is issued by the New York Trust Company, strictly 1:1 pegged to the US dollar, and based on ERC20 Standard tokens are built on the Ethereum network.
Gemini Dollar (GUSD) is a stable value coin that combines the credibility and price stability of the U.S. dollar with the technical advantages of cryptocurrencies and the oversight of U.S. regulators. Being ERC20 compliant, Gemini Dollar (GUSD) can be transferred on the Ethereum network.
Gemini dollars are created upon exiting the Gemini Platform and are redeemed or "destroyed" upon depositing into the Gemini Platform.
III. Issuer
GUSD's issuer, Gemini Trust Company, LLC (Gemini), is a New York trust company. Gemini operates under the direct supervision and supervision of the New York State Department of Financial Services and is subject to New York Banking Law and other applicable U.S. laws and regulations. Gemini maintains the necessary licenses and registrations to legally issue Gemini dollars.
IV. Proof of Solvency
An ideal outcome for stablecoins is the convergence between the tokens issued and the dollars generated by exchanging them. The number of tokens issued and in circulation can be observed on the blockchain, however, verifying the underlying USD balance to demonstrate proof-of-solvency requires scrutiny by a trusted party.
For the sake of assurance, we recommend that the Audit Committee of the Gemini Board of Directors engage an independent certified public accounting firm to periodically review and certify the underlying dollar balances in accordance with the certification standards established by the American Institute of Certified Public Accountants.
5. Creation, Redemption and Transfer
Simple and elegant mechanisms for creation and redemption are necessary to improve usability and encourage adoption. We do this by allowing Gemini customers to create and redeem Gemini dollars on the Gemini platform.
Gemini dollars are created upon exiting the Gemini platform. Gemini customers can exchange USD for Gemini USD at a 1:1 rate by withdrawing Gemini USD from their Gemini account to any Ethereum address they designate. The amount of Gemini dollars is debited from the customer's Gemini account balance upon withdrawal.
Gemini USD is redeemed or "burned" when deposited on the Gemini platform. Gemini customers can exchange Gemini Dollars at a 1:1 exchange rate by depositing Gemini Coins into their Gemini account. The dollar amount of Gemini Dollars is credited to the customer's Gemini account balance at the time of deposit.
The Gemini USD can be transferred on the Ethereum network.
