The Aleo Foundation today announced a partnership with Paxos Labs. The Aleo Network Foundation is a nonprofit organization responsible for overseeing the health of the Aleo network, a privacy-focused and compliance-focused infrastructure that powers secure, programmable payments worldwide. Paxos Labs provides enterprise-grade infrastructure for embedded on-chain finance, including branded stablecoin creation, stablecoin interest generation, and compliant money market integration.
The two parties will jointly launch USAD, the first US dollar stablecoin issued on a Layer 1 blockchain with smart contract capabilities, and enhanced privacy protection to ensure that sensitive information such as participant identities and transaction amounts are kept confidential.
This collaboration combines Aleo's zero-knowledge cryptography with Paxos Labs' issuance framework, backed by regulated, institutional-grade assets, to create a digital dollar that is secure and private by design. Unlike existing stablecoins, USAD encrypts transactions end-to-end, addressing the privacy concerns that have limited institutional adoption of blockchain financial infrastructure.
Leena Im, COO of the Aleo Foundation, said: “Privacy is the critical missing link for blockchain technology to achieve mass adoption, and with USAD, we are demonstrating that privacy can be achieved with programmable stablecoins. By combining Aleo’s technology with Paxos Labs’ issuance stack, we are taking a proactive and collaborative approach with businesses to demonstrate that a digital dollar can achieve regulatory trust and transparency while protecting user confidentiality.”
“Stablecoins have proven to be one of the most powerful innovations in financial markets, and we’re only scratching the surface of their potential,” said Bhau Kotecha of Paxos Labs. “ Our partnership with Aleo enables us to bring the digital dollar into a new era where businesses can embed money that is designed from the ground up for privacy, programmability, and trust.”
Stablecoin usage continues to surge, reaching $27.6 trillion in transactions in 2024, more than 7% higher than Visa and Mastercard's combined annual transaction volume. This growth, coupled with regulatory momentum from the passage of the Genius Act in July 2025, provides U.S. lawmakers with a regulatory framework for stablecoins and further promotes their integration into the financial mainstream.
Paxos Labs, spawned by Paxos, a leading regulated blockchain infrastructure and tokenization platform, is launching the US Dollar (USDG) token. The launch builds on the Aleo Foundation's role inthe Global Dollar Network ( GDN ), a Paxos-founded consortium responsible for distributing USDG, and builds on recent momentum with Binance Alpha , Revolut , Worldpay , and Request Finance .
About the Foundation and Aleo Network
Aleo Network is a privacy-first infrastructure layer for digital payments. Powered by zero-knowledge cryptography, Aleo combines end-to-end encryption with the programmability of smart contracts to bring privacy, compliance, and scalability to stablecoins and blockchain-based financial systems.
The foundation is headquartered in the United States and is backed by top investors including a16z, SoftBank, and Coinbase Ventures. It is focused on promoting the development of the next generation of secure on-chain financial infrastructure.
Contact: aleo@sutherlandgold.com
About Paxos Labs
Paxos Labs is a platform that provides enterprise-grade infrastructure for branded stablecoins and embedded on-chain financial products. Leveraging Paxos's over $120 billion track record in tokenization and regulatory expertise, Paxos Labs enables fintechs, banks, and marketplaces to issue their own branded stablecoins, integrate compliant yield products, and embed lending services directly into their platforms.
Contact: press@paxoslabs.com
