In order to create PAX Gold (PAXG), Paxos must buy London Good Delivery gold in the active marketplace. This means Paxos is subject to natural price movement in the gold market. When a customer confirms the 5-second quote, Paxos guarantees your gold will be purchased at that price. (In some very unlikely cases, the price of gold may suddenly jump much higher or lower, cancelling the quote early. In that case, Paxos will prompt you with another price quote.)
Paxos guarantees that customers will only ever have orders filled at a price they confirmed.