Coinbase, the largest crypto exchange in North America, has announced that it will no longer support Binance’s BUSD stablecoin, adding to Binance’s recent difficulties. This news comes just days after Paxos, another crypto-platform, was forced to stop minting BUSD due to regulatory action from the New York Department of Financial Services. Coinbase cited its due diligence in monitoring assets to ensure they meet listing standards, and said that it sees no commercial gain in continuing to support BUSD. Starting from noon on March 13, customers of Coinbase’s various platforms will no longer be able to trade BUSD, but they will be able to withdraw their funds.
Binance, which previously had a commercial arrangement with Paxos to mint new BUSD on the Ethereum blockchain and provide licensing support, has been experiencing regulatory scrutiny and oversight issues. As a result, Paxos has ended its relationship with Binance, and there are reports that the Securities and Exchange Commission (SEC) plans to sue Paxos for violating investor protection laws.
Binance CEO Changpeng Zhao has stated that his exchange foresees users migrating to other stablecoins over time, and the exchange is already shifting much of its trading to the TrueUSD stablecoin. TrueUSD has become the fifth-largest stablecoin, with Binance having minted $130 million worth of it in the past seven days. Meanwhile, BUSD has seen its market cap slashed to $10.7 billion from $22 billion in December and has lost its number three spot in the stablecoin market.
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