What Is Binance USD (BUSD)?
AI Summary
Show More
Quickly grasp the article's content and gauge market sentiment in just 30 seconds!
The Binance USD (BUSD) stablecoin is a product of Binance, one of the world's leading crypto exchanges, and Paxos Trust Company, a regulated blockchain and tokenization infrastructure platform. It stands apart from other stablecoins as one of the few that complies with the regulations set by the New York State Department of Financial Services (NYDFS).
However, in February 2023, following notice from the Securities and Exchange Commission (SEC) to Paxos that BUSD is an unregistered security, NYDFS ordered Paxos to halt the minting of BUSD. Paxos duly complied with this directive and ceased the minting process soon after, ending its relationship with Binance. The Binance USD supply and market capitalization have plummeted since the announcement, though it retains its peg to the U.S. dollar.
For those wondering what is BUSD and what the fuss is about, we'll tell you all you need to know about this stablecoin, from its beginnings to what's next.
Key Takeaways:
Paxos has stopped minting BUSD under an order from the NYDFS and announced that its relationship with the crypto exchange Binance is terminated.
While Paxos offers a 1:1 redemption from BUSD to the U.S. dollar, and conversion from BUSD to Paxos’ own stablecoin, USDP, Binance is encouraging its users to switch from BUSD to FDUSD.
Other stablecoin alternatives for investors to consider include USDT and USDC, the two largest stablecoins in terms of market cap.