The post Binance to Cease BUSD Operations By February 2024, Urges Users to Convert to Other Stablecoins appeared first on Coinpedia Fintech News
Leading cryptocurrency exchange Binance has recently announced the discontinuation of support for its BUSD stablecoin. This move comes amidst increasing regulatory scrutiny, particularly from the United States, following concerns raised in the wake of the FTX and Alameda Research incidents last year.
In response to the discontinuation of BUSD support, Binance has encouraged users holding BUSD stablecoins to convert their holdings into other supported stablecoins such as Tether (USDT), Circle (USDC), FDUSD, and TUSD. Notably, the exchange has assured users that the conversion can be made at a 1:1 ratio back to the United States dollar whenever needed.
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
Binance has outlined a timeline for these changes. Beginning September 07, BUSD borrowings on Cross Margin will be suspended. Moreover, starting from October 29, Cross Margin and Portfolio Margin users will no longer be able to utilize BUSD as new collateral in the Cross Margin Wallet. However, the option to use BUSD holdings in other tokens as collateral will remain available.
The regulatory challenges faced by Binance include assertions by the United States Securities and Exchange Commission (SEC) that its native cryptocurrency, Binance Coin (BNB), qualifies as a security. This has led to allegations of unauthorized operations within the US. Additionally, Binance has been accused of involvement in money laundering activities and listing digital assets as unregistered securities.
Earlier this year, Paxos Trust made headlines by discontinuing the issuance of new BUSD stablecoins, following directives from the New York Department of Financial Services (NYDFS). Despite these setbacks, Binance remains committed to asserting its position within the United States, emphasizing the enduring significance of digital assets in the global financial landscape.