Binance CEO CZ clarifies BUSD funds in crypto firm Paxos are safe, and that the company will continue to support BUSD amid the termination of the minting of BUSD tokens.
CZ tweeted “In summary, BUSD is issued and redeemed by Paxos. And funds are #SAFU!”
Paxos announced today will end its relationship with Binance for the branded stablecoin BUSD and it has stopped minting BUSD. The New York Department of Financial Services (NYDFS) instructed Paxos to stop issuing new BUSD tokens as of February 21.
CZ stated BUSD is a stablecoin wholly owned and managed by Paxos, and as it ends its issuance BUSD market cap will only decrease over time.
CZ asserted that Binance would continue to support BUSD for the foreseeable future and they do foresee users migrating to other stablecoins over time.
The Binance CEO added that the team will make product adjustments accordingly. He also added that Binance is exploring other issuers and non-USD-based stablecoins.
stated that all the funds are safe and fully covered by reserves. These reserves have already undergone numerous audits by different audit companies, CZ stated.
Reports emerged that SEC sued Paxos over BUSD for issuing and listing the token as an unregistered security. The Binance CEO stated he has no information about the lawsuit besides public news articles.
“‘IF’ BUSD is ruled as a security by the courts, it will have profound impacts on how the crypto industry will develop (or not develop) in the jurisdictions where it is ruled as such,” CZ added.
