Hodl Ninjas
  • News
  • Markets
  • Guides
  • NFTs
  • Defi
  • Exchanges
  • Subscribe
Search
bitcoin
Bitcoin (BTC) $ 26,945.22
ethereum
Ethereum (ETH) $ 1,674.45
tether
Tether (USDT) $ 1.00
bnb
BNB (BNB) $ 214.74
xrp
XRP (XRP) $ 0.516578
usd-coin
USDC (USDC) $ 1.00
staked-ether
Lido Staked Ether (STETH) $ 1,673.45
cardano
Cardano (ADA) $ 0.250723
dogecoin
Dogecoin (DOGE) $ 0.061923
solana
Solana (SOL) $ 20.34
tron
TRON (TRX) $ 0.088568
the-open-network
Toncoin (TON) $ 2.19
polkadot
Polkadot (DOT) $ 4.08
matic-network
Polygon (MATIC) $ 0.526799
litecoin
Litecoin (LTC) $ 65.83
bitcoin-cash
Bitcoin Cash (BCH) $ 236.95
chainlink
Chainlink (LINK) $ 8.04
wrapped-bitcoin
Wrapped Bitcoin (WBTC) $ 26,944.22
shiba-inu
Shiba Inu (SHIB) $ 0.000007
dai
Dai (DAI) $ 0.999819
true-usd
TrueUSD (TUSD) $ 0.998886
leo-token
LEO Token (LEO) $ 3.66
uniswap
Uniswap (UNI) $ 4.43
avalanche-2
Avalanche (AVAX) $ 9.18
stellar
Stellar (XLM) $ 0.112319
monero
Monero (XMR) $ 145.59
okb
OKB (OKB) $ 42.90
ethereum-classic
Ethereum Classic (ETC) $ 15.98
binance-usd
BUSD (BUSD) $ 1.00
cosmos
Cosmos Hub (ATOM) $ 7.24
hedera-hashgraph
Hedera (HBAR) $ 0.049754
filecoin
Filecoin (FIL) $ 3.32
lido-dao
Lido DAO (LDO) $ 1.68
internet-computer
Internet Computer (ICP) $ 3.13
crypto-com-chain
Cronos (CRO) $ 0.050953
maker
Maker (MKR) $ 1,483.13
quant-network
Quant (QNT) $ 90.32
aptos
Aptos (APT) $ 5.46
mantle
Mantle (MNT) $ 0.399121
vechain
VeChain (VET) $ 0.017194
arbitrum
Arbitrum (ARB) $ 0.894511
near
NEAR Protocol (NEAR) $ 1.14
optimism
Optimism (OP) $ 1.32
kaspa
Kaspa (KAS) $ 0.048296
aave
Aave (AAVE) $ 66.96
rocket-pool-eth
Rocket Pool ETH (RETH) $ 1,817.63
the-graph
The Graph (GRT) $ 0.087756
algorand
Algorand (ALGO) $ 0.101993
whitebit
WhiteBIT Coin (WBT) $ 5.18
usdd
USDD (USDD) $ 0.998388
Hodl Ninjas
  • News
  • Markets
  • Guides
  • NFTs
  • Defi
  • Exchanges
  • Subscribe
Search
Hodl Ninjas
Home Exchanges

Beginning of the Stablecoin End?

New York Orders Paxos Halt Binance Stablecoin Production

Luke Himmelsbach by Luke Himmelsbach
February 22, 2023
in Exchanges, News
0
Beginning of the Stablecoin End

Paxos CEO Charles Cascarilla plans to fight against an SEC lawsuit.

Share on FacebookShare on Twitter

The world’s largest crypto exchange, Binance, is in hot water after New York regulators ordered that they cease and desist all stablecoin production. Paxos, the provider of the Binance stablecoin as of this week, has stopped the creation of one of Binance’s most successful financial products. 

Binance stablecoin is no more… or is it? 

Well, the situation is more complicated than appears, as it often is. Let’s start off with who the issuer of the Binance stablecoin is, and then we can address what will actually happen to Binance in the short and long term. 

US Officials Tighten Crypto Trade Rules

Firstly, Paxos, the stablecoin company behind the token’s formation, announced on 13 February it would terminate its connection with the Binance return over BUSD, which is used to help market participants move faster into and out of the crypto industry. The New York Agency of Financial Services, the sector’s regulator, halted Paxo’s Binance minting on February 21, as US officials increased their examination of crypto trade rules.

Paxos confirmed that it will comply with the NYDFS directive to stop minting new stablecoins on February 21, though, and will continue to oversee BUSD dollar reserves. 

“BUSD will continue to be fully supported by Paxos and refundable to running operations customers till February 2024,” the company stated in a declaration. 

How Are Paxos and Binance Related?

To understand the implications here, we must understand the relationship between Paxos and Binance. Paxos is the “official” creator of BUSD, which is a token backed by dollars and issued on the Ethereum (ETH-USD) blockchain. However, Paxos has a licensing agreement with Binance, and Binance mints BUSD on its own blockchain, the Binance Smart Chain. 

This BUSD, however, is not subject to the same regulations and constraints as the BUSD minted by Paxos on Ethereum. In fact, it was revealed that BUSD on the Binance Smart Chain was at one point left undercollateralized by $1 billion. 

Though from a regulatory standpoint, you could argue it’s Paxos being attacked, BUSD is most strongly associated with Binance. It’s interesting to note, too, that Paxos has stopped BUSD minting. It is still minting USDP, which is also a dollar stablecoin. Technically. BUSD has lost its peg to the dollar, but this is a negligible difference: 

BUSD now trades at $0.9993. The peg is being maintained for now, but that doesn’t guarantee it won’t depeg in the future. 

The effects have also been felt in Binance’s native token BNB. BNB is down 11% in the last 24 hours, but this is to be expected given the broader market sell-off. Ethereum, for example, is down 7% on the last day. 

We Haven’t Heard the Last of Stablecoin!

One thing is for certain, though; crypto is not going to take this lying down. Paxos has said it will fight “vigorously” against the SEC lawsuit. The Coinbase CEO also stepped in yesterday, announcing the company will “Defend Staking in Court if Needed.” 

“Just ask the Lebanese citizens who are opting to use U.S. dollar stablecoin tether to pay for groceries as their country’s sovereign currency tanks and the economic crisis continues to unfold.” 

This new wave of crypto regulation may have taken the wind out of the current crypto rally. However, I still view this as an overall bullish thing for crypto. 

Let the chips fall where they may, but at least let them fall. Clear regulations will open the door to institutional acceptance and remove uncertainty.

These regulations will create a different playing field and bring about winners and losers. The winners will be those looked on favorably by regulators. This is already becoming very clear.

ShareTweetPin
Previous Post

Enter Worldcoin: An Eccentric Project Archiving the World’s Eyes

Next Post

Washington Names New Economic Advisor

Luke Himmelsbach

Luke Himmelsbach

Luke Himmelsbach is a long-time writer, editor, and podcast producer in the crypto and NFT space. He got into the space after being rugged (as is a right of passage in the NFT space) and now specializes in finding and analyzing new and exciting NFT projects.

Related Articles

Bittrex Officially Files for Bankruptcy
Exchanges

Bittrex Officially Files for Bankruptcy

May 18, 2023
ChatGPT Founder's WorldCoin Becomes Fastest Growing Wallet
Blockchain

ChatGPT Founder’s WorldCoin Becomes Fastest Growing Wallet

May 17, 2023
Binance Suspends Withdrawals
Exchanges

Binance Suspends Withdrawals

May 15, 2023
Founder of Twitter Jack Dorsey Donates $10 Million
Markets

Founder of Twitter Jack Dorsey Donates $10 Million

May 12, 2023
Next Post
Washington Names New Economic Advisor

Washington Names New Economic Advisor

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Trending Articles

  • AP Launches New NFT Marketplace

    A New Frontier For Photojournalism Emerges With AP’s New NFT Marketplace

    0 shares
    Share 0 Tweet 0
  • Crypto In Space? Lockheed Martin Joins Filecoin Foundation

    0 shares
    Share 0 Tweet 0
bitcoinBitcoin
$ 26,945.22
$ 26,945.22
0.49%
ethereumEthereum
$ 1,674.45
$ 1,674.45
0.2%
tetherTether
$ 1.00
$ 1.00
0.02%
solanaSolana
$ 20.34
$ 20.34
0.57%
cardanoCardano
$ 0.250723
$ 0.250723
0.72%
polkadotPolkadot
$ 4.08
$ 4.08
0.35%

Become a Hodl Ninja.

Stay on top of market trends, find exciting new projects, hold on for dear life.

johnsmith@example.com
© 2021 Hodl Ninjas – A BettorView Brand.
No Result
View All Result
  • News
  • Markets
  • Guides
  • NFTs
  • Defi
  • Exchanges
  • Subscribe

© 2021 Hodl Ninjas - A BettorView Brand.

Search
$ USD
  • $ USD
  • € EUR
  • ₹ INR
0
Previous 25
Next 25
#CoinPriceMarketcapVolume (24h)SupplyChange (24H)Price Graph (7D)
Previous 25
Next 25
Subscribe to Hodl Ninjas

Get the latest news in crypto and be the first to hear about exciting new projects.

Enter your email address

No thanks, I’m not interested.