BUSD Stops Issuing Lazy Bags｜Chiu Changpeng said "User Funds SAFU".

U.S. Orders Paxos to Stop Issuing BUSD, Coin Announces "Abandonment of BUSD" as Primary Trading Currency

The U.S. government has launched a series of targeting of the cryptocurrency market since last week, including rumors that the Federal Reserve and the U.S. Office of the Comptroller of the Currency (OCC) are cutting off access to the cryptocurrency market and banks.

The New York Department of Financial Services (NYDFS) has ordered stablecoin issuer Paxos to stop issuing new Binance USD (BUSD). Subsequently, Paxos has emphasized that it is still operating as normal and the redemption of BUSD will not be affected, while CoinSecure has stated that Paxos' reserves in other banks are safe and unaffected.

What the hell is going on?

According to the Wall Street Journal, the U.S. Securities and Exchange Commission (SEC) plans to prosecute stablecoin issuer Paxos for allegedly violating investor protection laws by issuing and shelving a U.S. dollar stablecoin called Binance USD (BUSD).

SEC Sends Prosecution Notice Letter to Paxos According to the Wall Street Journal, people familiar with the matter have revealed that the SEC has sent a "Wells Notice" to stable-currency-issuing financier Paxos Trust Co.

BUSD hit slightly off the hook, BNB falls below 290 magnesium

According to a statement from a CoinSafe spokesperson today (13th), Paxos has notified CoinSafe that it will stop minting BUSD. This, coupled with the SEC's earlier announcement that it will prosecute Paxos, spread panic in the market, and BUSD has slightly delinked from the market, as low as $0.9985.

The BNB currency price also fell, dropping below US$300 to a low of US$288, a drop of 8.4% in the last 3 hours.

Will investors be affected?

The New York Department of Financial Services (NYDFS) has ordered stablecoin issuer Paxos to stop issuing new BUSDs.

Subsequently, Paxos emphasized that it was still operating as normal.BUSD's redemption-related activities are not affected.In an earlier personal tweet, CZ Zhao, CEO of CoinSec, also said that Paxos would continue to provide services and manage BUSD redemptions, and that Paxos had provided security to CoinSec.No worries about capital reserves，And its reserves have been audited many times by various audit firms.。

Paxos: still fully supported and redeemed until February 2024

Paxos, the issuer of the stablecoin BUSD, announced in a press release that it is terminating its relationship with CoinSafe for BUSD and that existing BUSDs will continue to be fully supported by Paxos.Remain fully supported and redeemable until at least February 2024。

Paxos Emphasize that new and existing customers will be able to redeem their funds in U.S. dollarsor to transfer them to the BUSD converted to Pax Dollar (USDP)This is a regulated stablecoin also backed by the U.S. dollar and also issued by the Paxos Trust.

CZ also mentioned that CoinSafe is dropping BUSD as the primary token for trading pairs for the time being, as BUSD is currently in a regulatory situation that prevents it from minting new coins:

Coin will continue to support BUSD for the foreseeable future, and we do anticipate users moving their assets to other stable currencies over time. We will make product adjustments accordingly. For example, we will no longer use BUSD as the primary currency for trading pairs.

Background Supplement: Determination that "BUSD is an unregistered security

The U.S. government has launched a series of targeting of the cryptocurrency market since last week, including rumors that the Federal Reserve and the U.S. Office of the Comptroller of the Currency (OCC) are cutting off access to the cryptocurrency market and banks.

On February 9, the U.S. Securities and Exchange Commission (SEC) cracked down on cryptocurrency pledging services for failing to register "securities" and issued a $30 million settlement against the Kraken exchange, which immediately stopped offering cryptocurrency pledging services to U.S. users.

Today, the SEC turned the tables on Paxos, the issuer of CoinSafe stablecoins, with plans to sue Paxos for violating investor protection laws based on allegations that BUSD, the cryptocurrency it issues and shelves, is an unregistered security.Both the SEC and the Paxos spokesperson declined to respond to the news, with Coin stating: BUSD is issued and owned by Paxos, and Coin only receives licenses for its branding.。

Note: According to the U.S. Securities Act, when law enforcement officials have collected complete evidence and believe that a person under investigation is in danger of violating the securities laws, they will usually notify the person under investigation through a "Wells Notice". The Wells Notice informs law enforcement officers of the evidence available to them and provides the subject of the investigation with an opportunity to rebut and present his or her own views in order to persuade law enforcement officers to refrain from initiating enforcement action against the subject of the investigation.

Currency Analyst: The SEC just wants to regulate everything!

NY FSA Explains Ban: Unauthorized Issuance of Binance-Peg BUSD

According to the New York Department of Financial Services NYDFS AnnouncementNYDFS has only authorized Paxos to issue BUSD on Ether and has not authorized the issuance of Binance-Peg BUSD on any other blockchain, and Binance-Peg BUSD is not issued by Paxos, and therefore states that Paxos Breach of Obligation.

According toCoinsafe Official WebsiteDisplayIn order to extend the applicability of BUSD to other blockchains, CoinSafe has released a packaged version of the stablecoin, Binance-Peg BUSD, which tracks the value of the original Paxos-issued ERC-20 BUSD on a 1-to-1 basis, although this is not licensed by the NYDFS.

In addition, Currency Security has admitted that the BUSD peg was flawed and that the BSC version of BUSD was once overprinted by a billion dollars, and later said that the problemsAlready.Paxos also stated in its announcement that the Binance-Peg BUSD issued by CoinSafe was a CoinSafe product and not issued by Paxos, as if to separate the two sides.

What is BUSD?

Paxos is a third-party partner in the issuance of BUSD: Paxos currently issues the stablecoins Pax Dollar (USDP) and Binance USD (BUSD), but CoinSecure has repeatedly explained that BUSD, although it carries the name of CoinSecure, is actually issued and maintained by Paxos, and that it is backed by sufficient reserves.

BUSD Reserves Fully Supported：All BUSDs issued by Paxos Trust will always be backed by a 1:1 dollar-denominated reserve, fully segregated and held in an insolvency remote account (meaning they will not be affected by corporate insolvency).

BUSD is a stablecoin created by Paxos, which issues BUSD (ERC-20) on the Ether blockchain, and CoinSecurity, which offers BUSD-linked Binance-Peg BUSD (BEP-20) tokens on the CoinSecurity chain.

Note: Paxos is regulated by the New York State Department of Financial Services (NYDFS) and holds a BitLicense, a virtual currency license issued by NYDFS, and has previously applied for a National Trust Bank license from the OCC.

Finally.CZ Changpeng Zhao, CEO of Currency Security, left a "4" in his personal Twitter post to say ignore FUD, fake news and attacks, etc.