By Hassan Mehmood (Saudi Arabia)
Binance has made some visible changes in its underlying stablecoin program. The firm has decided to reduce support for BUSD over time. As per the official plan, Binance is planning to delist BUSD by February 2024 next year.
On this account, the cryptocurrency exchange has published an official announcement earlier this day. The notification has also confirmed that BUSD will continue to maintain 1:1 USD ratio.
On the other hand, Binance has asked the account holders on the platform to convert their BUSD reserves with other contemporaries. At the same time, the firm has also informed its users that they have until the second month of next year to make the conversion.
The crypto trading platform has retained that users can convert their BUSD reserves with First Digital USD or FDUSD coin for zero trading fees.
On the other hand, Binance has also decided to diminish the support for Binance-pegged BUSD stablecoin on various blockchain networks. The networks that will gradually extinguish support for the BUSD include blockchains such as BNB Chain, Polygon, Avalanche, and Tron among others.
The aforementioned blockchains are set to ban withdrawals for BUSD while increasing the deposits. Since BUSD is an ERC-20 token, withdrawals and deposits on Ethereum blockchains will remain open until further notice.
Also read:At the same time, Binance is also set to halt spot and margin trading options for BUSD trading pairs. Additionally, the firm will seize lending with BUSD for cross-margin starting 7th September.
Meanwhile, from October 19th, traders will not be able to use BUSD as collateral for their cross-margin wallet accounts. But the firm has continued the exchanging BUSD with other tokens for maintaining collateral.
Binance Discontinues Perpetual Contracts for BUSD
Binance has maintained that the perpetual contracts for BUSD-margin positions are discontinued. At year end, the firm is set to make changes to its loaning and earn services in regards to BUSD stablecoin.
Binance Gift Card has also halted support for BUSD reserves and awards confirmed for September 30th. At the same time, the Pay Merchant Services on Binance has delisted BUSD for payment options at the same deadline.
The first impression regarding the new changes is that Binance is converting traction from BUSD to FDUSD. The second major reason for the decision is the confirmation of halting of new BUSD token minting from Paxos. Paxos has officiated that it will halt issuing new BUSD stablecoins starting February next year.
New York Department of Financial Services (NYDFS) has ordained Paxos to halt BUSD. At the same time, SEC has warned Paxos with an unregistered security lawsuit for dealing in BUSD. Paxos has confirmed that it will process all BUSD redemptions.
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