• SEC ruling on BUSD has been called into question by Truflation CEO Stefan Rust, who believes the decision is politically motivated.
• Paxos, the US-regulated issuer of the stablecoin, was ordered to stop minting new BUSD by the New York Department of Financial Services (NYDFS).
• Binance, the world’s leading cryptocurrency exchange, said it would continue to support BUSD but could look at other alternatives as a main trading pair.
SEC Ruling on BUSD „Makes No Sense“
Stefan Rust, CEO of Truflation, has expressed his disbelief at the SEC’s ruling about BUSD being a security. The former Bitcoin.com CEO believes there’s a political angle to the action and noted that this could have been triggered by Binance freezing out USDC last year.
Paxos Ordered to Cease Issuing New Tokens
The New York Department of Financial Services (NYDFS) issued an order for Paxos – the issuer of BUSD – to cease issuing new tokens. In response to this order, Paxos announced that it would comply but also said that it would be terminating its relationship with Binance despite still maintaining that BUSD is not a security.
Truflation CEO Condemns SEC Ruling
Truflation CEO Stefan Rust believes that the SEC’s action against Paxos does not make sense legally and looks like it is politically motivated due to the diminishing trading volumes of USDC compared to USDT and BUSD. He further stated that any economy can be affected by large companies like BlackRock who have $10 trillion balance sheets.
Binance Continues To Support BUSD
Despite these developments, Binance still announced that it would continue supporting its own stablecoin -BUSD- but did state it could look at other alternatives as main trading pairs instead. It had previously looked into increasing use of this coin across its ecosystem including through providing no-fee trading on its trading pairs and offering auto conversion between USD Coin and Tether (USDT).
Ultimately both Paxos and Stefan Rust are in disagreement with how they feel this situation should be handled legally however they both agree upon one thing: politically motivated decisions can have drastic effects on economies such as those with large balance sheets like BlackRock’s $10 trillion one.