Binance CEO Warns Of ‘Profound Impact’ On Crypto Industry If BUSD Is Ruled As A Security
As we know that the US Securities and Exchange Commission (SEC) remembers to take action against Paxos Trust Company on the stablecoin Binance USD (BUSD), Binance CEO Changpeng Zhao (CZ) has come out to clarify the situation. In a tweet on Monday, Paxos, which is regulated by the New York Department of Financial Services (NYDFS), announced on Monday that it would “certainly support this branded stablecoin for BUSD.” will end all its relationship with Binance” and Paxos also said that on February 21 “the new BUSD token will be “Will stop doing it”.
They stressed that we were informed by Paxos that they have received or been directed to stop manufacturing new BUSD by the New York Department of Financial Services. The CEO tweets that even though BUSD, known as Binance USD, is not issued or received by Binance… … BUSD is a stablecoin that is wholly owned and managed by Paxos. Works in Which is wholly owned and managed by Paxos. Furthermore, the CEO also points out that until Paxos stops creating the latest BUSD token, the market value of the stablecoin will only decrease over time. In terms of market cap, at the time of writing, BUSD has a market cap of around $16 billion, which makes it the seventh largest cryptocurrency and the third largest stablecoin in the world. Of course, “Paxos will continue to manage the service and redemption of the product,” according to the CEO. He also added that Paxos has given Binance any assurances that the funds are safe “and have been fully covered by reserves in their banks and have been audited multiple times in the past by different audit firms”. ”
Certainly the CEO also commented on the SEC’s alleged lawsuit on the Securities and Exchange Commission’s lawsuit against Paxos, acknowledging that he is not an expert in US law and has no additional information on the matter beyond public news articles. The same CEO also said that he personally agrees with crypto analyst Miles Deutscher’s assessment.
Crypto analyst Binance USD on Monday morning gives his take on the Securities and Exchange Commission’s proceedings against Paxos, tweeting that BUSD has been leveled as an ‘unregistered security’ by the Securities and Exchange Commission and Its issuer Paxos is being prosecuted. But how on earth is a stablecoin considered secure until it clearly meets the How test criteria. There is of course never a ‘profit expectation’ when buying BUSD.
In another tweet, Deutscher acknowledged: that “it doesn’t need to pass the Howey test” to be considered technically safe. In addition, he asserted that the Securities and Exchange Commission has basically an investable The property is free to define the security as it wishes, if so. But it undoubtedly sets a scary precedent.
Commenting on whether BUSD is a security, the CEO warns, he said that if “BUSD is used as a security by the courts, it will certainly have a profound impact on how the agriculture industry develops or Will not develop again where it is governed. For the foreseeable future we will definitely continue to support BUSD and go with it. We may see users migrating to other stablecoins over time and we have to adjust and understand our operations accordingly such as for example using BUSD as the main pair for trading. We have to stay away from doing and also advise the users and much more besides. It was definitely concluded that given the ongoing uncertainty in some markets, they would have to review other projects in courts to ensure that their users are not immune from any undue harm, as was the case with crypto exchanges. The CEO concluded.
Last week, the Securities and Exchange Commission took action against Kraken over the crypto exchange’s staking program. The exchange agreed to cease service to US customers and pay $30 million plus prejudgment interest, and civil penalties, and its CEO Jesse Powell later vowed to protect the US crypto market and US consumers. urged Congress to pass a law for those “going offshore to obtain services no longer available in the US”.
