According to a recent blog post, Binance, one of the world’s leading cryptocurrency exchanges, announced that it will phase out support for the BUSD stablecoin. This decision comes following Paxos’ halt in minting new BUSD tokens. With a set deadline of February 2024, Binance users are now encouraged to convert their BUSD assets into other available stablecoins or digital assets on the platform.Â
The End Of The Road For BUSD
In a statement released on August 31, Binance urged its users to begin transitioning their holdings in Binance USD (BUSD) to a recently introduced stablecoin as the exchange prepares to phase out support for BUSD. This move aligns with earlier rumors and confirms that Binance will cease support for BUSD by February 2024, in accordance with Paxos’ decision to discontinue BUSD redemptions at the same time.
However, BUSD will maintain its 1:1 backing by USD. Binance remains committed to offering a diverse range of stablecoins and digital assets on its platform. Users are advised to transition their BUSD holdings to other supported assets on Binance before the February 2024 deadline. Options include trading BUSD for FDUSD with no transaction fees or converting BUSD to FDUSD at a 1:1 rate.
According to the announcement, BUSD borrowings on Cross Margin will be suspended starting September 7, 2023, at 06:00 UTC, and from October 19, 2023, at 06:00 UTC, no new BUSD collateral will be accepted. Withdrawals of Binance-Peg BUSD via various networks will halt on September 7, 2023, at 00:00 UTC. However, BUSD (ERC-20) transactions via Ethereum will continue until further notice.
Moreover, BUSD-margined perpetual contracts will be gradually delisted, with details to come. Users can switch their BUSD futures balances to other supported assets via the Futures Asset Conversion feature.
Binance is urging users to either trade or switch their BUSD holdings for First Digital USD (FDUSD), a stablecoin introduced in June by Hong Kong’s First Digital Group. The stablecoin made its initial appearance on the Binance platform in late July.
Community Remembers BUSD
On February 13, Paxos formally declared the termination of its partnership with Binance concerning the U.S. dollar-anchored stablecoin BUSD. Starting February 21, the company ceased the issuance of new BUSD tokens in compliance with guidelines from the New York Department of Financial Services (NYDFS).
Paxos assured that all existing BUSD tokens will continue to be fully backed and redeemable through Paxos Trust Company until at least February 2024. During this period, customers can exchange their BUSD for U.S. dollars or convert them to another Paxos-issued stablecoin, Pax Dollar (USDP), the company confirmed.
The end of the road for BUSD on Binance is not just a business decision; it’s the closing of a significant chapter in the exchange’s history. BUSD was Binance’s first foray into the stablecoin market, a pioneering move that solidified its reputation as an industry leader. As we say goodbye to BUSD, we can’t help but feel a sense of nostalgia and gratitude for the role it played in shaping the Binance we know today.
