Binance Encourages New Stablecoin as BUSD Support Ends; Urges Users to Transition by February 2024

Cryptocurrency exchange giant Binance has announced the gradual discontinuation of support for BUSD (Binance USD) on its platform.

Binance users have been urged to transition their assets away from BUSD and explore alternative stablecoin options before February 2024.

The move comes in the wake of Paxos, the issuer of BUSD, ceasing the minting of new tokens, prompting Binance to take the necessary steps to ensure a smooth transition for its user base.

BUSD’s Gradual Farewell

One of the highlights of Binance’s announcement is the assurance that BUSD will continue to be backed 1:1 by the US dollar, providing users with confidence in the stablecoin’s value during this transition period.

As Paxos has halted minting of new BUSD, #Binance will now gradually remove support for the stablecoin on our platform.

BUSD will always remain backed 1:1 by USD, and we continue to support a wide range of other stablecoins.

Find more details below.

— Binance (@binance) August 31, 2023

To facilitate the transition process, Binance has outlined several key changes across its platform:

• Spot & Margin Trading: Binance will gradually delist BUSD spot and margin trading pairs. This action will be accompanied by separate delisting announcements.

• Cross Margin Borrowing: BUSD borrowings on Cross Margin will be suspended, with the timeline provided for users to make necessary adjustments.

• Deposits & Withdrawals: Withdrawals of Binance-Peg BUSD tokens via multiple networks will cease, although deposits and withdrawals of BUSD (ERC-20) tokens via the Ethereum network will continue to be supported.

• Futures: Binance will also delist BUSD-margined perpetual contracts, with users having the option to convert their BUSD balances in the futures wallet to other supported futures margin assets.

• Earn & Auto-Invest: Binance users participating in Simple Earn Flexible Products and Auto-Invest plans will need to take note of specific dates for the cessation of BUSD subscriptions and plan updates. Binance assures a smooth transition to alternative stablecoin options.

• Liquid Swap & Dual Investment: BUSD liquidity pools in Liquid Swap will be gradually delisted, and Dual Investment will continue to support BUSD until the end of the year 2023.

• Flexible DeFi Staking & Loans: BUSD positions in Flexible DeFi Staking will be closed, and the asset will be delisted as a loanable and collateral asset at specified dates.

• Gift Card & Binance Pay: BUSD will be delisted from Binance Gift Card services, and it will be deactivated as an order currency within Binance Pay Merchant Service. Existing orders will still be refundable in BUSD.

A Strategic Move

The decision to transition away from BUSD reflects Binance’s commitment to providing its users with a seamless and secure trading experience.

The exchange giant is ensuring that users have sufficient time and information to migrate their assets to alternative stablecoins, such as FDUSD, which is offered as an attractive alternative.

Binance’s proactive approach to managing this transition is expected to benefit its vast user base, ensuring minimal disruption during this phase. With clear timelines and alternatives in place, Binance aims to keep its platform efficient and user-centric.

NB: Any Information provided is NOT FINANCIAL ADVICE. Do Your Research before making any Financial Decisions.