Binance Ditches BUSD To Adopt Rival Stablecoins For “Safu Fund”; BUSD's Reign Coming To An End?

Binance News: Back on January 29, 2022, Binance unveiled the “Secure Asset Fund for Users (SAFU), which is an emergency insurance fund valued at $1 billion to safeguard its users from any catastrophic event. The SAFU fund wallets were initially stocked with BNB, BUSD, and BTC.

Timeline of Binance-usd

Binance USD (BUSD) has suffered a steep decline in active addresses following the regulatory crackdown by U.S. authorities. This development continues a series of dips within the Binance ecosystem in recent weeks.

Cryptocurrency exchange Coinbase (NASDAQ: COIN) on Monday announced that it will suspend trading of stablecoin Binance USD (CRYPTO: BUSD) on March 13 this year, due to non-compliance with the platform's listing requirements.

Per a report from crypto news outlet The Block, crypto exchange Coinbase will halt trading operations with the Binance-branded stablecoin, BUSD. The digital asset has been heavily scrutinized following the Securities and Exchange Commission (SEC) Wells Notice against its issuer, Paxos.

The US Securities and Exchange Commission (SEC) issued a Wells notice to the BUSD issuer Paxos earlier this month. Since the Binance CEO, Changpeng Zhao (CZ), broke the news, the second and third-largest stablecoins have witnessed diverse movements.

Key Points: Recently, 140,000,000 BUSD were burned at the Paxos Treasury, causing the Binance Dollar (BUSD) to fall out of the top 10 by capitalization. As Paxos received a death sentence from US regulators, BUSD is rapidly disappearing off the market's stablecoin map.

After Paxos announced that it would no longer mint the stablecoin BUSD, 4.98 billion BUSD stablecoins have been removed from circulation to date. The Paxos-managed stablecoin has also fallen out of the top ten crypto assets by market capitalization, slipping below dogecoin's valuation with a market cap of around $11.

Eight days ago, Paxos announced that the company would no longer mint the stablecoin BUSD. Since then, the coin's market capitalization has been sliding lower as redemptions have become more prominent.

Paxos Binance BUSD News: In a latest development in the Binance USD (BUSD) episode, Paxos CEO Charles Cascarilla seems to be actively engaged with the U.S. Securities and Exchange Commission (SEC) over the recent order to stop issuing the stablecoin. The New York Department of Financial Services recently ordered Paxos to stop issuing BUSD.

The Securities and Exchange Commission is reportedly preparing to take action against Paxos Trust Co, which could probably have significant implications for all stablecoins, including tether and USDC, the two largest, which are worth $110 billion combined. Paxo issues stablecoin, a cryptocurrency designed to mirror real-world assets often backed by real assets such as bonds or cash in reserve.

The firm behind Binance's stablecoin, Paxos Trust Company, is having constructive discussions with the U.S. Securities and Exchange Commission after the firm disclosed that the regulator told the company it should have registered the token as a security, according to an internal email from Paxos' chief executive officer.