As the curtain falls on 2023, it will also fall on Binance USD (BUSD) — and it’s not a belated April Fool’s joke or a twist in a Hollywood blockbuster saga. The popular cryptocurrency exchange Binance has declared it will pull the plug on this turbulent stablecoin once the clock strikes midnight on Dec. 31st. Holders of BUSD have been given exactly 15 days from today to either withdraw or morph their existing BUSD stash into other currencies.
This dramatic turn of events follows the announcement by Paxos, the wizard behind the curtains, to stop minting fresh BUSD coins. As the saying goes – as one door closes, another opens – and it has for First Digital USD (FDUSD). As the New Year chimes ring in, users with a remaining BUSD draining pool will see it magically convert into FDUSD.
The retirement of BUSD is hardly breaking news as Binance has been slowly but surely clipping the wings of its native stablecoin. It began its farewell journey with the stoppage of lending services back in October. The climax to this drama was a sensational $4.3 billion-trading punch thrown by U.S. market watchdogs, compelling the then CEO Changpeng Zhao to throw in the towel.
Legal wrangles with the U.S. Securities and Exchange Commission, which pointed accusing fingers at BUSD as an unregistered security, proved to be the final nail in the coffin. Paxos got hit with a freeze order from the NY Department of Financial Services further weakening BUSD.
Rewind to a year ago, the BUSD juggernaut was mustering a tremendous market cap of $23.3 billion. As we stand today, its worth has plummeted by an eye-watering 92% to a meager $1.7 billion. As Shakespeare once penned, “What’s past is prologue,” and it seems this quote rings true for the futuristic, roller-coaster world of cryptocurrencies.