On Feb. 27, Coinbase revealed that it will cease trading Binance USDs on March 13 due to its “listing standards.” This is a major development affecting the third-largest stablecoin by market capitalization in a significant manner.
Binance USD Is Being Removed for Not Meeting Coinbase Qualifications
Coinbase.com (simple and advanced), Coinbase Pro, Coinbase Exchange, and Coinbase Prime will be affected by the decision to suspend trading for Binance USD. As per their Twitter thread, your funds remain accessible even with this suspension of trading; you have the full ability to withdraw them at any time. A spokesperson from the exchange stated: “We decided that our internal monitoring processes no longer met listing standards for Binance USD, which is why it was suspended.”
When asked for comment, Binance remained silent. Coinbase’s website discloses that its digital asset listing team voted on which assets should be listed on the exchange based on extensive vetting and review to meet legal, compliance, and technical security standards. Furthermore, further business assessments are done, as well as monitoring of an asset’s ongoing performance to make certain they still fulfill the highest criteria at all times.
Issuer Paxos Under Investigation By US Authorities
The United States Securities and Exchange Commission recently sent Paxos Trust, the issuer of Binance USD, a Wells notice – an indication of impending enforcement action. Just one day later, on February 13th, The New York State Department of Financial Services ordered them to stop issuing their cryptocurrency leading to over a $2 billion decrease in market capitalization within days.
On day two, following Coinbase’s thread on Twitter, they declared that the SEC may be interested in certain aspects of BUSD but emphasized the fact that stablecoins are not securities. Moreover, top news sources reported that Paxos held “constructive” conversations with the SEC concerning this topic as recently as February 21st.
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