Binance Announces End of BUSD Lending Services by October 25

6:29 pm
October 3, 2023

Binance, one of the largest cryptocurrency exchanges, will be discontinuing its borrowing and lending services for its native stablecoin, Binance USD (BUSD), as part of a phased termination of BUSD-related services.

Following a significant announcement, Binance has confirmed that it will be shutting down its borrowing and lending services for Binance USD (BUSD), its native stablecoin. The termination of BUSD-related services will be carried out in phases, and is expected to be completed by February 2024. As part of this process, BUSD lending services will cease to operate on October 25, 2023, with all outstanding BUSD loans and collateral positions being closed by the end of the month.

Users who have been utilizing BUSD for lending purposes will now need to explore alternative stablecoins such as Tether (USDT), Dai, TrueUSD (TUSD), and USD Coin (USDC) for their lending needs on the Binance platform.

This decision by Binance comes amidst its ongoing legal battle with the US Securities and Exchange Commission (SEC). In February 2023, Paxos, the issuer of BUSD, terminated its partnership with Binance due to the legal uncertainties surrounding the exchange. Paxos also announced its intention to halt redemptions from BUSD to US cash and Treasuries in February 2024, temporarily pausing the minting of new BUSD tokens.

Frequently Asked Questions (FAQ)

1. What is Binance USD (BUSD)?

Binance USD (BUSD) is a stablecoin issued by Binance, one of the largest cryptocurrency exchanges in the world. It is pegged to the US dollar on a 1:1 ratio, providing stability in value.

2. Why is Binance discontinuing BUSD lending services?

Binance is terminating its BUSD lending services as part of a phased termination of BUSD-related services. This decision is likely influenced by the ongoing legal disputes with the US Securities and Exchange Commission (SEC).

3. Can users still withdraw BUSD from Binance?

While BUSD withdrawals via various blockchain networks were suspended last month, BUSD withdrawals are still available on the Ethereum network. However, users are encouraged to transition their BUSD holdings into fiat or other cryptocurrencies before the 2024 deadline.

4. What are the alternative stablecoins users can use for lending purposes on Binance?

Users who have been relying on BUSD for lending purposes on Binance can explore alternative stablecoins such as Tether (USDT), Dai, TrueUSD (TUSD), and USD Coin (USDC) for their lending needs on the platform.

5. How long will the phased termination of BUSD-related services take?

The phased termination of BUSD-related services is expected to be completed by February 2024. BUSD lending services will cease on October 25, 2023, with all outstanding loans and collateral positions being closed by the end of the month.

Sources: CoinJournal


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