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Transitioning Away from BUSD
Cryptocurrency exchange Binance has announced its decision to discontinue support for its stablecoin, BUSD, by 2024. This monumental step comes after tumultuous legal battles amidst shifting regulatory landscapes.
Binance, through its app, informs users that support for the BUSD stablecoin will be gradually phased out.
The process is set to unfold until Paxos, the United States-based blockchain infrastructure platform, completes its acquisition of BUSD by February 2024. This acquisition is anticipated to shape the direction of BUSD's journey, raising curiosity about the outcome.
Despite ranking among the top five stablecoins with a market capitalization exceeding $3.1 billion, BUSD has faced scrutiny from the US regulators.
Earlier this year, the United States Securities and Exchange Commission (SEC) took legal action against Paxos Trust Company for issuing BUSD without proper registration, labeling it an unregistered security. This legal confrontation led Paxos to halt the issuance of new BUSD tokens starting from February 21, casting a cloud of uncertainty over the stablecoin's future.
BUSD's Exit Spotlights Stablecoin Viability and Regulatory Compliance
The decision raises questions about the viability of stablecoins that face legal challenges and underscores the need for stronger compliance protocols across the industry. The acquisition of BUSD by Paxos Trust Company by February 2024 adds a layer of complexity. The way the transition is managed will determine whether it improves or worsens the situation.
Binance has also recently announced the following spot trading pairs will cease trading on September 1, 2023: ANKR/BNB, CVC/BUSD, EPX/BUSD, HIVE/BUSD, IOTA/BNB, KLAY/BUSD, LRC/BNB, MBL/BUSD, MTL/ETH, UMA/BUSD.
While phasing out support for its stablecoin BUSD, Binance is not slowing down its global expansion plans. The exchange is pushing ahead with its expansion plans, venturing into Latin America by launching a service that facilitates crypto-to-bank account payments.