- Binance discontinued BUSD support, delisting on September 6th, and halting withdrawals on September 7.
- Anticipation of BUSD discontinuation due to Paxos minting halt, with accelerated timeline signaled.
- SEC’s sealed motion suggests a potential legal clash with Binance in the recent week.
Binance has a phased discontinuation of support for its BUSD stablecoin. This entails removing BUSD from both spot and margin trading pairs. Users have been advised to convert their BUSD holdings into alternative assets by February of the upcoming year. In the near term, Binance is set to delist BUSD as a loanable asset on September 6th and will stop facilitating withdrawals of Binance-pegged BUSD tokens via BNB Chain, Avalanche, Polygon, and Tron on September 7.
The decision to discontinue support for BUSD has been anticipated ever since Paxos, the stablecoin issuer, was instructed to halt its minting in February. Binance CEO Changpeng Zhao had previously mentioned that “BUSD will slowly wind down over time,” although the specific timeline for this process remained uncertain. The recent announcement to cease BUSD loans with only a week’s notice indicates an accelerated timeline for these actions.
“As Paxos has halted minting of new BUSD, Binance will gradually cease support for BUSD products. Please be assured that BUSD will always be backed 1:1 by USD.”
Binance
At the time of writing, the 24-hour trading volume of BUSD has dipped to approximately $700 million. This stablecoin was embroiled in a regulatory dispute following the New York Department of Financial Services (NYDFS) order in February, instructing Paxos to halt its issuance. Subsequently, Binance faced legal action from the U.S. regulator, the Commodity and Futures Trading Commission (CFTC), on allegations of offering unregistered cryptocurrency derivatives products, contravening federal law.
Earlier this week, indications of a potential new legal confrontation emerged for the exchange, as the U.S. Securities and Exchange Commission (SEC) submitted a sealed motion pertaining to Binance. This enables the SEC to submit sensitive or confidential information without disclosing its contents to the public.
