• Binance CEO Changpeng Zhao has distanced himself from the BUSD stablecoin following regulatory action.
• CZ stated that Binance has an agreement to let Paxos use their brand, but that they did not create the coin.
• Zhao also expressed skepticism about claims that Circle had raised alarm bells with regulators.
Binance CEO Distances Himself From BUSD Stablecoin
Binance’s Chief Executive Officer Changpeng „CZ“ Zhao distanced himself from the Binance-branded stablecoin BUSD, after regulatory action caused minting to cease. CZ said at a Twitter Spaces on Tuesday that „BUSD is not issued by Binance,“ and that they only have an agreement to let Paxos use their brand.
Regulators Act Following Minting Cease
On Monday, it was reported that BUSD issuer Paxos would stop minting new tokens following a request from the New York Department of Financial Services (NYDFS). The cryptocurrency, which is pegged to the value of the U.S. dollar, had been accused of constituting an unregistered security by regulators.
Working With Other Stablecoins
Despite this setback, CZ stated that they will continue working with other stablecoin issuers or creators, citing existing support for USD coin (USDC) and tether (USDT). He also expressed skepticism about claims that rival stablecoin issuer Circle had raised alarm bells with regulators.
Mounting U.S Crypto Regulatory Pressure
The news comes amid mounting US crypto regulatory pressure as authorities seek to enforce stricter compliance standards in the industry. It remains unclear what further action could be taken against entities involved in providing services related to the tokenized asset class in future months and years ahead.
Industry Implications
The implications of these latest developments are yet to be fully understood by those in the industry, but it seems likely that more stringent regulations could cause disruption across various service providers going forward as authorities look increasingly closely at cryptocurrencies and stablecoins issued in their respective jurisdictions.