On Monday, Coinbase (COIN), a prominent cryptocurrency exchange, officially suspended the trading of the Binance USD (BUSD) stablecoin, according to a tweet. In February, the exchange had already announced its intention to delist BUSD due to concerns about liquidity, with Coinbase CEO Brian Armstrong being among the notable figures to raise the issue.
The move to suspend the trading of BUSD by Coinbase was prompted by Paxos halting the minting of the stablecoin in response to regulatory action by the New York Department of Financial Services and, as per reports, the federal Securities and Exchange Commission. This development led to growing concerns among industry stakeholders regarding the stability of BUSD, which in turn, seems to have influenced Coinbase’s decision to suspend trading of the stablecoin.
However, users holding BUSD on Coinbase will still be able to withdraw their assets at any time, the exchange clarified in its announcement. The suspension of BUSD trading comes amid growing regulatory scrutiny and concerns over stablecoins, particularly following Tether’s $18.5 million settlement with the New York Attorney General’s office in February.
Coinbase’s decision may have significant implications for BUSD and the wider stablecoin market, particularly given the exchange’s reputation and status in the crypto industry.