Binance to end BUSD by 2024; this is the time to convert your holdings

The world’s largest crypto exchange, Binance, is planning to terminate its support for its native BUSD stablecoin by 2024. The exchange has therefore urged users to convert their tokens to other crypto assets. 

This development was revealed via a pop-up notification on the exchange’s mobile app, according to several sources on X (Twitter), on Wednesday. The pop-up notification stated that the embattled BUSD issuer, Paxos Trust Company, will end the stablecoin’s redemption by February 2024. With this, Binance urged its users to convert their holdings.

This follows increased regulatory pressure on the stablecoin in 2023, which has led to a drastic decline in its market share so far. 

Binance will delist BUSD trading pairs 

Also on Wednesday, Binance announced plans to delist eight BUSD trading pairs by September 7. This move was made in tandem with its plan to finally withdraw full support of the stablecoin by 2024. 

In a blog post, Binance laid out intentions to delist the eight cross-margin and isolated trading pairs which include AMB/BUSD, DASH, FIDA, HARD, HOT/BUSD, NULS/BUSD, PORTO/BUSD and REQ/BUSD.

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Also, the exchange will be deleting the IOST/BTC margin trading pair. According to the blog post, the delisting process will occur in two stages. The first part will see the exchange suspend all isolated margin borrowing for these specific pairs on September 1, 2023, at 06:00 (UTC). 

Subsequently, the world’s largest exchange will close all users’ positions, terminate any pending order, and enable an automatic settlement before proceeding to delist these pairs from its isolated margin market on September 7, 2023, at 06:00 (UTC). At the same time on the same day, the trading pairs will also be removed from Binance’s cross-margin market. 

The exchange stated that users would not be permitted to modify their trading positions during the delisting procedure. So, they are advised to close all open positions and transfer their assets from margin wallets to spot wallets prior to September 7 to avoid any possible losses.

Reports and developments indicate that this move is part of a much larger plan by the crypto exchange to finally stop BUSD in 2024.

Regulatory hurdles

Binance and its native token have been affected by the high level of regulatory scrutiny all year. Recall that in February, we reported how the New York Department of Financial Services ordered Paxos to halt its issuance. Citing: “Several unresolved issues related to Paxos’ oversight of its relationship with Binance regarding Paxos-issued BUSD.”

Related post: $BUSD to depeg below $1? All you need to know about the Binance, Paxos and SEC drama

Also, the United States SEC dispatched a Wells Notice to Paxos Trust Co. The formal notice alleged that the stablecoin was an unregistered security investment contract.

With that unfavourable development, BUSD has lost over 80% of its market cap since then. Falling from $16.13 billion on February 9 to its current value of $3.07 billion, according to data from Coinmarketcap.

From occupying a sixth position in market capitalisation in February, to now sitting at the 23rd spot, coupled with a decline of around $13 billion in six months, the coin’s appeal to investors has waned dramatically due to regulatory hurdles.