Recently, the cryptocurrency exchange Coinbase proclaimed that it will stop trading Binance USD (BUSD) on its platform since the token doesn’t meet its listing standards. According to the reports, the incident is scheduled to take place on March 31 at about noon.
In addition, the digital currency exchange said that the conclusion was rooted in a recent analysis of the stablecoin, the issuance of which Paxos ceased after receiving an injunction from New York regulators.
Coinbase also clarified that holders of BUSD would retain access to their assets and be capable of transferring them as usual. Nevertheless, the exchange has notified that trading would be unavailable on Coinbase.com (including Basic and Advanced Trade), Coinbase Pro, Coinbase Exchange, and Coinbase Prime.
BUSD’s legal woes: SEC and NYDFS
In a story from earlier this month, Tokenhell noted that the SEC accused Paxos of breaking investor protection regulations when issuing Binance Dollar (BUSD). As per the regulatory body, this token, and several others in the cryptocurrency ecosystem are defined as a security.
As a result, the SEC issued a Wells notice to Paxos Inc., a document employed by the government to notify firms and people of future enforcement action. Nonetheless, the stablecoin issuer said that it unequivocally opposes the SEC’s classification but is engaged in constructive negotiations with the governing body.
In contrast, the crypto company severed connections with its long-time collaborator, crypto platform Binance, and ceased issuing BUSD due to legal litigation from the U.S. regulator.
What’s Next for BUSD
While Coinbase is the initial cryptocurrency exchange to delist and suspend trading of the Binance token, it may not be the last. Moreover, Changpeng CZ Zhao, CEO of cryptocurrency exchange Binance, believed that BUSD’s market valuation would drop over time.
In summary, BUSD’s price and trading volume will undoubtedly take a severe hit due to Coinbase’s decision to delist the currency. Coinbase is one of the most prominent crypto exchanges worldwide, with millions of users and billions of dollars in trading activity.
Further, removing BUSD from Coinbase may result in a drop in demand as traders seek out other stablecoins that are still accessible on the site.
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