Aleo Network Foundation and Paxos Labs Launch USAD: A Privacy-Preserving, Programmable USD Stablecoin on Aleo L1
San Francisco, California, October 1, 2025, Chainwire
Aleo Network Foundation and Paxos Labs announce USAD, a privacy-preserving, programmable U.S. dollar stablecoin built to scale
The Aleo Network Foundation, the nonprofit steward of the Aleo Network—a privacy and compliance infrastructure powering secure, programmable global payments—today announced a strategic partnership with Paxos Labs, the enterprise infrastructure platform for embedded on-chain finance spanning branded stablecoin issuance to compliant yield and integrated money markets. Together, the organizations are launching USAD, the first U.S. dollar stablecoin issued on a layer-1 blockchain that fuses smart contract functionality with enhanced privacy, keeping sensitive details such as counterparties and transaction amounts confidential while remaining auditable to oversight.
By bringing together Aleo’s zero-knowledge cryptography with Paxos Labs’ enterprise-grade issuance framework, backed by regulated institutional-quality reserves, the partners aim to deliver a digital dollar that is secure, programmable, and private by design. Unlike conventional stablecoins, USAD employs end-to-end encryption and zero-knowledge proofs to close the privacy gap that has constrained institutional adoption of blockchain-based financial rails.
“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.”
“Stablecoins have proven to be one of the most powerful innovations in financial markets, and we are only scratching the surface of their potential,” said Bhau Kotecha. “Partnering with Aleo allows us to bring digital dollars into a new era where enterprises can embed money that is private, programmable, and trusted from the ground up.”
USAD is designed to unlock enterprise use cases that demand programmable settlement without sacrificing confidentiality, including B2B payouts, supply chain financing, embedded financial services, treasury operations, and cross-border remittances. With transactions encrypted and validated using zero-knowledge proofs, institutions can automate workflows and enforce policies in smart contracts while limiting exposure of commercially sensitive data on-chain. At the same time, the architecture supports compliance needs by enabling appropriate oversight, aligning with the industry’s shift toward privacy-preserving, regulation-ready infrastructure.
Market momentum underscores the opportunity. Stablecoin activity reached $27.6 trillion in transaction volume in 2024, exceeding the combined annual volumes of Visa
