Crypto exchange Binance has encouraged users to start converting their Binance USD (BUSD) stablecoin holdings into a newly listed stablecoin amid plans to wind down support for BUSD.
In an Aug. 31 statement from Binance, the crypto exchange confirmed prior speculation that it will gradually stop support for BUSD by February 2024 — a decision in line with Paxos‘ plans to end BUSD redemption at that time.
The official statement is the first time Binance has addressed the subject after several users shared screenshots of a pop-up on their mobile app about the planned support halt.
FYI: Binance will stop BUSD in 2024
According to an official announcement on crypto exchange Binance’s app, the exchange pops up a notification for users that they will stop supporting BUSD in 2024.
This is an elignment with Paxos phase out for purchasing BUSD by February… pic.twitter.com/XiRPy71b3p
— Nu Brave (@NuBraveIN) August 30, 2023
In its statement, Binance said it is encouraging users to trade or convert their BUSD balances for First Digital USD (FDUSD) — a stablecoin launched in June by the Hong Kong-based trust company First Digital Group which had its debut listing on Binance in late July.
The exchange added BUSD to FDUSD trades and conversions are fee-free, and on Aug. 30 delisted eight BUSD pairs. The exchange has previously incentivized users to use the stablecoin with zero-fee trading pairs for FDUSD with Bitcoin (BTC) and Ether (ETH).
Binance’s decision to halt BUSD support appears to follow the United States Securities and Exchange Commission on Feb. 13 alleged BUSD was an unregistered security in a wells notice it issued to Paxos.
The same day, the New York Department of Financial Services ordered Paxos to halt the issuance of BUSD.