Paxos Wins as SEC Ends BUSD Stablecoin Investigation
The post Paxos Wins as SEC Ends BUSD Stablecoin Investigation appeared on BitcoinEthereumNews.com.
The Securities and Exchange Commission (SEC) has now decided to close its investigation into Paxos Trust Company over Binance USD (BUSD) stablecoin. This decision, communicated through a termination notice, is a major development in the stablecoins’ regulatory environment and provides some certainty for the industry. SEC Ends Paxos BUSD Stablecoin Investigation According to a letter that was shared with Paxos on July 9, Jorge Tenreiro, the acting chief of the SEC’s crypto assets and cyber unit informed Paxos that he would not be recommending an enforcement action. This notice came more than a year after the SEC sent Paxos a Wells notice indicating a possible enforcement action over the dollar-backed BUSD stablecoin, which Paxos issued in partnership with Binance. “Paxos prevails in SEC investigation of BUSD stablecoin” 👏 On Tuesday, we received a formal termination notice from the SEC stating that it will not recommend enforcement action against Paxos Trust Company in the investigation of Binance USD (BUSD). View the letter and our… pic.twitter.com/8kjysfsPg3 — Paxos (@Paxos) July 11, 2024 Despite these allegations, Paxos maintained that BUSD was backed 1:1 with dollar-denominated reserves and was not considered as a security as per the criteria. This protracted probe raised a lot of concern within the crypto space, which impacted Paxos’ capacity to enter into new agreements. The SEC’s decision to halt the investigation follows a federal judge’s ruling in favor of Binance. On June 28, the judge concluded that BUSD sales were not a securities offering, thus, the charge connected to this was dropped. Consequently, this legal victory for Binance might have also impacted the SEC’s decision on Paxos in one way or the other. Impact on Paxos and the Stablecoin Sector Walter Hessert, the head of strategy at Paxos, breathed a sigh of relief following the conclusion of the investigation.…
Filed under: News - @ July 11, 2024 10:18 pm