- Binance to discontinue BUSD support by February 2024.
- BUSD holders need to take specific steps to safeguard their holdings.
- The move has implications for the broader crypto community.
Binance, the world’s leading cryptocurrency exchange, has announced it will gradually discontinue support for Binance USD (BUSD) stablecoin by February 2024. If you’re a BUSD holder, this directly affects you. Here’s what you need to know and what steps you can take to safeguard your assets.
What’s Happening with BUSD on Binance?
On Thursday, August 31, Binance revealed plans to phase out support for BUSD due to regulatory issues. Namely, the decision comes after Paxos, the BUSD issuer, stopped minting new BUSD tokens.
Binance will cease various services related to BUSD, including spot and margin trading, deposits, and withdrawals, on different timelines leading up to February 2024. Here’s a breakdown of the key dates:
September 7, 2023: Suspension of BUSD borrowings on Cross Margin.
September 15, 2023: Discontinuation of BUSD plan subscriptions on Auto-Invest.
October 13, 2023: Termination of BUSD subscriptions on Simple Earn Flexible Products.
December 31, 2023: Dual Investment will support BUSD until this date.
February 2024: Final deadline for users to convert their BUSD to other stablecoins.
If you hold BUSD in any form—whether in your spot wallet, futures wallet, or you’re using it for staking—you will be affected by this change.
How to Safeguard Your BUSD Assets
If you’re a BUSD holder, here’s what you need to do to safeguard your assets:
Convert Your BUSD: Binance encourages users to convert their BUSD to other stablecoins. Notably, Binance offers zero trading fees for users to convert BUSD to First Digital USD (FDUSD) stablecoin.
Use Binance Convert: You can manually convert your BUSD balances to FDUSD at a 1:1 ratio using Binance Convert until further notice.
Update Auto-Invest Plans: If you have a BUSD Auto-Invest plan, modify it to alternatives like FDUSD before September 15, 2023.
Check Your Earn Products: If you have BUSD in Simple Earn Flexible Products, be aware that these will stop offering BUSD subscriptions by October 13, 2023.
Monitor Announcements: Keep an eye on Binance announcements for updates on the phase-out, especially if you use BUSD for other services like Liquid Swap or Dual Investment.
On the Flipside
- The move to drop BUSD resulted from increased regulatory scrutiny over Paxos, the issuer of BUSD. Namely, Paxos is under investigation by the New York Department of Financial Services.
- As Binance phases out BUSD, the platform is directing users toward FDUSD. While the exact relationship between FDUSD and Binance is unclear, the exchange has promoted the stablecoin since its launch in June 2023.
Why This Matters
For BUSD holders, the immediate concern is the need to transition their assets to other stablecoins. However, this move also highlights the regulatory scrutiny over Paxos and Binance.
Read more about Binance’s decision to phase out BUSD:
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