Significant Changes In the Stablecoin Sector
- The Termination of BUSD Transactions on Coinbase
- How Binance is Upending the Crypto Market With its Quick TUSD Stablecoin Minting
The Termination of BUSD Transactions on Coinbase
Due to ongoing regulatory pressure on Binance’s stablecoin, Coinbase halted trading BUSD on March 13th. BUSD, a token minted by Paxos, was the focus of a February investigation by the New York Department of Financial Services (NYDFS) and the US Securities and Exchange Commission.
As the stablecoin no longer complies with its listing requirement, Coinbase stated on February 27th through its Twitter account that it would cease BUSD trading as of March 13th. As a result, users of Coinbase Prime and, Coinbase Pro, Coinbase Exchange will be unable to conduct basic or sophisticated trading due to this suspension.
Once the NYDFS compelled Paxos to halt making the BUSD owing to security concerns in the middle of February, the BUSD and its issuer, Paxos, came under regulatory investigation. A Wells warning from the Securities and Exchange Commission charging BUSD of being unlicensed security was received by Paxos at the same time and was made public.
Binance terminated its cooperation with Paxos due to the regulatory proceedings taken against BUSD. Moreover, Changpeng Zhao, the CEO of Binance, hinted that the firm would be separating itself from BUSD.
However, he added that because his company was not dependent on the stablecoin, the events would not substantially impact it. Like many other crypto firms, Coinbase saw an immense burden in 2022 and the first few months of 2023.
As a result, the company’s user base and income significantly decreased, according to the company’s September to December earnings report. Concerns about Coinbase’s products were also highlighted by the recent settlement between the SEC and Kraken regarding the latter’s staking business.
Notwithstanding the difficulties the cryptocurrency market has encountered, Coinbase has shown resilience. The exchange announced a solid January performance shortly after publishing its last yearly quarter report, and it anticipates that growth will continue in the first quarter of 2023.
Moreover, Coinbase clarified that its offerings are entirely compliant and not at risk of being pursued by the SEC in response to the regulatory action against Kraken.
How Binance is Upending the Crypto Market With its Quick TUSD Stablecoin Mint
The largest cryptocurrency exchange in the world, Binance, is turning its attention to TrueUSD (TUSD) in the face of legal oversight of the Binance USD (BUSD).
The market value of TUSD has recently increased, currently at $1,117,630,886, making it the fifth-largest stablecoin by market capitalization, according to statistics from crypto analytics company Nansen. In addition, Binance recently issued over $130 million worth of TUSD stablecoins.
The TrueUSD stablecoin’s circulating quantity has hit $1.1 billion, the highest amount since last August, according to statistics from CoinGecko. As a result, TrueUSD just overtook Paxos Dollar (USDP), Gemini Dollar, and Frax Finance (FRX) stablecoin to move up to position five on the list of most widely used stablecoins (GUSD).
TrueUSD (TUSD), formerly TrustToken, is a stablecoin produced by the cryptocurrency company ArchBlock tied to the US dollar. Chainlink’s proof-of-reserve (PoR) tracker shows that all fiat assets support the value of TUSD entirely.
Just a few weeks ago, the stablecoin sector saw significant upheaval, with TUSD seeing a rise in popularity as Binance turned its attention to the stablecoin in reaction to regulatory scrutiny of BUSD. As a result of this change, TUSD has risen the ranks and is now the fifth-largest stablecoin by market cap.
The suspension of BUSD by Coinbase has also been revealed, underscoring the unstable nature of the stablecoin market.