Blockchain infrastructure platform Paxos will stop issuing new stablecoin BUSD (BUSD) amid an investigation by New York regulators.
Paxos officially announced on February 13 that the company will end its relationship with Binance for its USD-pegged stablecoin BUSD.
As of February 21, Paxos will stop printing new BUSD tokens, in accordance with the instructions and coordination with the New York Department of Financial Services (NYDFS).
Paxos confirmed that all existing BUSD tokens will remain fully backed and redeemable through the Paxos Trust Company until “at least February 2024.” Customers will be able to exchange funds in USD and convert BUSD tokens to another stablecoin issued by Paxos, Pax Dollar (USDP), the company added:
“This action does not affect our ability to continue serving new or existing customers, our ongoing dedication to increasing our staff or funding our business goals. Paxos remains committed to being a global leader in blockchain tokenization infrastructure […]”
Paxos also notes that Paxos Trust is a regulated institution overseen by the NYDFS and audited by the top four accounting firms, referring to its public transparency report. The company will continue to maintain strong regulatory capital to operate USDP as well as its gold-backed stablecoin Pax Gold (PAXG).
This is a developing story, and further information will be added as it becomes available.