Blockchain – The U.S. Securities and Exchange Commission and Paxos, a blockchain infrastructure platform and issuer of Binance’s stablecoin Binance USD (BUSD), are in discussions on the SEC’s decision to classify the stablecoin as a security.
Paxos CEO Charles Cascarilla informed staff via email that the company and the commission are having “productive negotiations” over BUSD and that they will continue in private, according to Reuters.
Cascarilla allegedly stated, “We are engaged in cordial negotiations with the SEC, and we look forward to continuing that communication in private. The firm is willing to litigate to support its claim that BUSD is not a security.
The creator of BUSD, a stablecoin connected to Binance, the largest cryptocurrency exchange in the world, is Paxos. BUSD and the USD are directly correlated.
Paxos was told last week by New York state officials to halt creating new BUSD coins. The order was issued, according to the New York State Department of Financial Services, “as a consequence of various unresolved problems connected to Paxos’ management of its connection with Binance,” according to a consumer notice.
Relationship With Binance is No Longer in Paxos’ Interest, the company claims
The decision to cancel the cooperation with Binance, according to Cascarilla’s email, was made because the two parties “no longer coincide with our current strategic aims.” He continued by saying that discussions on BUSD with the SEC and the NYDFS were unrelated to their collaboration with Binance.
According to the Paxos CEO, the business was still working with the SEC to publish its application for a clearing agency licence and with the Office of the Comptroller of the Currency (OCC) of the United States to receive final approval for its national trust bank charter.
With growing regulatory scrutiny in the US, Binance is also expanding its focus beyond Paxos and dollar-based stablecoins, as was previously reported.
The SEC had threatened to sue the corporation for its BUSD issuance, it was later disclosed. BUSD is regarded as an unregistered security, the agency claimed.
Some commercial and public organizations have expressed interest in working with the exchange to establish another stablecoin, one that might not be dollar-based, according to Patrick Hillmann, chief strategy officer at Binance, who stated this in an interview last week.
Hillmann stated in an interview with Forbes, “There is really fascinating potential, particularly in Europe and the Middle East.
It’s important to note that Binance CEO Changpeng Zhao has also suggested that the exchange issue a stablecoin that isn’t backed by the dollar. CZ said in a tweet that the business is looking towards stablecoins with no USD base and other issuers.
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