On August 30, Binance notified its users that it would cease support for BUSD in February 2024. This move comes after Paxos’ decision to halt its commitment to the stablecoin.
BUSD is a stablecoin that was created by Paxos in cooperation with Binance. Following the SEC's announcement that BUSD is an unregistered security, Paxos decided to stop issuing new tokens and terminate its agreement with Binance.
However, the company is obliged to redeem and convert BUSD until February 2024, so Binance will stop supporting the stablecoin only after these obligations have been fulfilled.
Paxos allows users to convert BUSD to dollars or other supported cryptocurrencies on its platform with the guarantee that each BUSD counts as one dollar. Primarily catering to institutional clients, regular users who do not have a Paxos account may find it easier to swap BUSD to another cryptocurrency on an exchange that still supports this stablecoin.
Meanwhile, Paxos recently became an issuer of the PYUSD stablecoin in partnership with the payment giant PayPal. In this case, regulators have no questions, at least for the time being.
BUSD was one of the largest stablecoins in the market. According to CoinMarketCap, in November 2022, the stablecoin achieved its peak capitalization of $23.5 billion. However, the regulatory pressures led to a natural decline. Currently, BUST rests at $3.1 billion.
If you still have BUSD in your pocket, do not forget to swap it to another stablecoin before February 2024.
Also read: PayPal launches its stablecoin