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Crypto exchange Binance will discontinue borrowing and lending services for its native stablecoin Binance USD (BUSD) by October 25.
As per the announcement made on October 3, the exchange will finalize all existing BUSD loan and collateral positions by the end of the month. Users will still have the option to borrow and lend on Binance using stablecoins such as Tether (USDT), Dai, TrueUSD (TUSD), and USD Coin (USDC). At present, users can lend their BUSD on Binance with an estimated annual percentage yield of 3%.
On August 31, Cointelegraph reported that Binance plans to terminate all services associated with its BUSD stablecoin by 2024. Earlier, on February 13, New York fintech company Paxos, the issuer of the BUSD stablecoin, announced it would sever ties with Binance due to the ongoing litigation involving the U.S. Securities and Exchange Commission. Paxos indicated it would stop redemptions from BUSD to the underlying U.S. cash and Treasuries in February 2024, with new minting of BUSD currently paused.
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Prior to the termination announcement, BUSD was among the largest stablecoins, achieving a peak market capitalization of $23 billion in November 2022. It has since decreased to $2.23 billion at the time of this publication.
The discontinuation of BUSD and related services has taken place in stages. Last month, the exchange halted BUSD withdrawals via BNB Chain, Avalanche, Polygon, Tron, and Optimism but kept them available on the Ethereum network. Conversely, BUSD deposits remain accessible across all blockchains, with the exchange advising users to convert their BUSD balances into fiat or other cryptocurrencies by next year.
FYI: Binance will stop BUSD in 2024
According to an official announcement on the crypto exchange Binance’s app, the exchange has issued a notification for users that they will cease support for BUSD in 2024.
This aligns with Paxos’ phase-out for purchasing BUSD by February… pic.twitter.com/XiRPy71b3p— Nu Brave (@NuBraveIN) August 30, 2023
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