Binance USD Activity Plummets Amid Regulatory Scrutiny
The stablecoin issued by Binance and Paxos has seen a sharp drop in its usage since regulators questioned its compliance status.
Stablecoin Binance USD - issued by Binance in partnership with Paxos - has seen a sharp decline in its activity since regulators questioned its compliance status.
The number of addresses sending and receiving Binance USD reached new lows in two years today, according to data firm Glassnode, which tracked both metrics using a seven-day moving average.
The drop in Binance USD activity comes after Paxos received a Wells notice from the U.S. Securities and Exchange Commission in February. The regulator claimed that BUSD was an unregistered security — a claim that Paxos "categorically" rejected.
The following month, Binance CEO Changpeng Zhao announced that his exchange would use the remaining $1 billion from its Industry Recovery Initiative funds to buy Bitcoin, Ether and BNB. The crypto assets were to be purchased with Binance USD. The exchange has also been removing some Binance USD pairs — such as perpetual contracts for STEPN's, Near Protocol's and Avalanche's native crypto assets.