Binance is discontinuing its Binance USD (BUSD) lending services by October 25, following Paxos’ lead amid regulatory challenges. Explore alternative stablecoin options as BUSD-related offerings fade away.
Binance has announced the discontinuation of its Binance USD (BUSD) lending services by October 25, as part of a broader plan to cease all BUSD-related offerings by 2024. This decision aligns with Paxos’ move to sever ties with the exchange due to regulatory issues with the U.S. Securities and Exchange Commission (SEC). Paxos had also revealed its plan to halt BUSD redemptions to U.S. cash and Treasuries by February 2024, temporarily pausing the creation of new BUSD.
BUSD, which once had a peak market capitalization of $23 billion in November 2022, has seen a significant decline to $2.23 billion. Binance has encouraged users to transition their BUSD assets to fiat or other cryptocurrencies. Notably, they have promoted the use of First Digital USD (FDUSD), a stablecoin by First Digital Group.
This decision by Binance comes in response to the SEC’s allegations that BUSD operates as an unregistered security. The New York Department of Financial Services has instructed Paxos to stop issuing BUSD. As Binance navigates regulatory challenges, users are advised to stay informed and make informed decisions regarding their BUSD holdings.