Paxos Labs and the Aleo Network Foundation have officially launched USAD on the Aleo mainnet, introducing what they describe as a programmable, privacy-preserving digital dollar built for real-world payments and on-chain commerce.
USAD is a U.S. dollar–pegged stablecoin backed 1:1 by USDG reserves and issued through Paxos Labs’ stablecoin framework. What makes the launch notable is the infrastructure behind it: USAD runs on Aleo’s Layer 1 blockchain, which is designed around zero-knowledge cryptography and privacy by default.
A Stablecoin Built for Confidentiality
Unlike most major stablecoins that operate on fully transparent public blockchains, USAD encrypts wallet addresses and transaction amounts end-to-end. That architecture aims to address a growing concern among enterprises and institutions: how to use blockchain-based payments without exposing sensitive financial data.
By combining Paxos Labs’ institutional-grade reserve management and operational controls with Aleo’s zero-knowledge infrastructure, USAD enables confidential digital dollar transactions while maintaining programmability through smart contracts.
The companies say this makes USAD suitable for a wide range of use cases, including cross-border payments, treasury management, payroll, humanitarian aid distribution, and broader consumer applications.
“Privacy has become a critical requirement for institutional stablecoin adoption,” said Bhau Kotecha, Co-founder of Paxos Labs. “USAD demonstrates how stablecoin issuance can support both transparent public ledgers and privacy-focused networks, giving organizations flexibility depending on their regulatory and user needs.”
Programmable Privacy for Enterprise Adoption
Aleo’s blockchain infrastructure allows selective disclosure models, meaning applications can reveal specific data when required for compliance or operational purposes—without sacrificing default confidentiality.
According to Leena Im, Chief Operating Officer of the Aleo Network Foundation, this design enables developers and enterprises to build programmable financial applications without exposing unnecessary transactional data.
“With USAD live on Aleo mainnet, developers can build digital dollar payment flows that protect user data while still scaling to production environments,” Im said.
The timing of the launch aligns with accelerating stablecoin adoption globally. Industry estimates place stablecoin transaction volumes at approximately $33 trillion in 2025—exceeding the combined annual volumes of Visa and Mastercard. Regulatory developments, including the passage of the GENIUS Act in July 2025 and expanded oversight frameworks in the U.S., have also contributed to growing institutional confidence in digital dollar infrastructure.
Expanding the On-Chain Dollar Ecosystem
Paxos Labs operates as a spinout from Paxos, the OCC-chartered blockchain infrastructure firm that supports major financial institutions including Mastercard, Stripe, and PayPal. The USAD rollout also builds on Aleo’s participation in the Global Dollar Network (GDN), a consortium focused on responsible expansion and standardization of digital dollar infrastructure.
With USAD now live, developers, enterprises, governments, and non-profits can begin integrating privacy-enabled stablecoin functionality directly on Aleo’s mainnet.
