Palm USD (PUSD) is a stablecoin pegged 1:1 to the U.S. dollar, developed and issued by Palm Azgar Finance. It is structured as a fully reserved digital asset designed to provide an alternative mechanism for accessing dollar-based value outside of traditional U.S. financial systems, with a particular focus on cross-border transactions in non-aligned economic contexts. ^[3]

Overview

Palm USD was developed in response to perceived structural inefficiencies in the global use of the U.S. dollar, especially for institutional, corporate, and sovereign clients in regions like the Middle East and Asia. The project aims to bridge traditional finance with blockchain technology by providing a compliant and transparent digital dollar for large-scale international settlement and treasury management. PUSD is a multi-chain asset, operating on several major blockchain networks to facilitate broad accessibility and integration.

The stablecoin operates on a fully reserved model, meaning that for every PUSD token in circulation, there is an equivalent or greater value of assets held in reserve. The issuer, Palm Azgar Finance, operates through regulated entities in the British Virgin Islands (BVI) and the Kingdom of Saudi Arabia. The project places significant emphasis on its transparency framework, which includes regular attestations and audits conducted by independent third-party firms to verify the backing of the circulating supply. Its Shariah compliance is a key differentiator, enabling its use by Islamic financial institutions and investors in a market managing over $3 trillion in assets. ^[1]

System Architecture

PUSD is structured to maintain a fixed value relative to the U.S. dollar through a fully collateralized reserve system. Each token represents a claim on underlying assets and is intended to be redeemable for an equivalent value in fiat currency through authorized institutional partners. The system operates on a full-reserve basis, meaning the total value of assets held in custody is maintained at or above the value of all tokens in circulation. Tokens are issued only after corresponding fiat funds are received by designated banking partners and can be redeemed at par, subject to standard compliance procedures. The reserves are not used for lending or proprietary trading activities.

The reserve portfolio consists of cash and cash-equivalent instruments, including U.S. dollar–denominated assets and currencies pegged to the U.S. dollar, specifically the Saudi riyal (SAR) and UAE dirham (AED). The inclusion of these pegged currencies reflects a regional focus on Gulf financial systems. Reserve assets may also include short-duration, low-risk instruments and Shariah-compliant financial products such as sukuk. All assets are required to meet defined eligibility criteria, including compliance with Islamic finance principles.

Public descriptions of the reserve composition have varied across different materials. Some official statements indicate that reserves are held exclusively in SAR and AED, while other sources describe a broader composition that includes U.S. dollar deposits and, in some cases, U.S. Treasury securities. This variation suggests either differences in how the reserves have been presented or changes in the reserve strategy over time, with the most consistently referenced structure emphasizing SAR and AED as primary backing assets. ^{[4] [5]}​

Governance

Regulatory Framework

Palm Azgar Finance operates through licensed entities in multiple jurisdictions and states that it engages proactively with regulators and policymakers. Its compliance program includes standard financial industry processes such as Identity Verification (KYC), ongoing transaction monitoring for Anti-Money Laundering (AML), sanctions screening, and Suspicious Activity Reporting (SAR).

These compliance measures are applied at the participant level through its network of licensed partners during the fiat-to-crypto (issuance) and crypto-to-fiat (redemption) stages. This off-chain enforcement model allows the project to meet regulatory requirements without implementing on-chain controls like token freezing. ^{[2] [5]}

Transparency and Audits

The project uses a formal verification framework to assess the adequacy and composition of its reserves, involving independent accounting firms as well as Shariah compliance reviewers. This framework includes multiple reporting intervals: weekly attestations that compare the total value of reserve assets to the circulating supply, monthly audits that examine reserve composition, custody arrangements, and internal controls, and annual audits that cover full financial statements alongside Shariah compliance certification. Access to these reports, including monthly attestations and annual audits, is generally provided upon request to institutional clients and partners rather than being fully public. ^[5]​

Shariah Compliance

PUSD has received Shariah certification from recognized Islamic finance scholars, making it a key differentiator in the stablecoin market. This certification confirms that the stablecoin's structure, operations, and underlying reserve assets are compliant with the principles of Islamic finance, which prohibit activities such as earning interest (riba). This allows PUSD to be integrated into Islamic financial products and used by institutions and individuals who adhere to these principles. ^[4]

Partnerships

• Alrajhi Bank
• Emirates NBD
• Ledger
• Ethereum
• BNB Chain
• Solana
• Tron