Paxos, the issuer of BUSD, stopped the issuance of BUSD on February 21st, 2023. BUSD will still have 1:1 backing with US dollar-denominated reserves. This is a direct result of avoiding regulatory problems.
In this case, with the NYDFS or the New York Department of Financial Services. So, let’s find out why Binance will stop supporting BUSD in 2024.
Binance Will Stop Supporting BUSD
Binance released a statement, encouraging its users to convert BUSD to other stablecoins. In particular, Binance mentioned First Digital USD (FDUSD). This new stablecoin launched in June 2023. First Digital Group, a Hong Kong-based trust company, backs this stablecoin. Binance listed FDUSD in late July. It has a “zero maker fee promotion for FDUSD trading pairs.”
As Paxos has halted minting of new BUSD, #Binance will now gradually remove support for the stablecoin on our platform.
BUSD will always remain backed 1:1 by USD, and we continue to support a wide range of other stablecoins.
Find more details below.
— Binance (@binance) August 31, 2023
As of now, Binance is slowly dwindling its support for this stablecoin. This is in line with Paxos. They will stop redeeming BUSD as of February 2024. To support FDUSD, Binance made the conversion to FDUSD fee-free.
On 30th August, Binance already delisted eight trading pairs with this stablecoin. This comes all as a result of the SEC, who alleged on 13th February 2023, that BUSD is an unregistered security. The SEC issued a well notice to Paxos. This coincided with the NYDFS ordering Paxos to halt BUSD issuance on the same day. Paxos stopped issuing this stablecoin as of 21st February. They still back BUSD 1:1 with US dollar-denominated reserves. Meanwhile, Binance continues to support a variety of other stablecoins.
FYI: Binance will stop BUSD in 2024🪙
According to an official announcement on crypto exchange Binance’s app, the exchange pops up a notification for users that they will stop supporting BUSD in 2024.
This is an elignment with Paxos phase out for purchasing BUSD by February… pic.twitter.com/XiRPy71b3p
— Nu Brave (@NuBraveIN) August 30, 2023
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