Binance is showing a strong commitment to their restructuring plan. As the largest exchange in the world, they previously indicated that they would focus primarily on their core use case as a crypto exchange. Fortunately, they are staying true to this plan. However, the downside is that some of their actions are happening too quickly and without warning.
First, they said they would be closing down their payment platform, formerly known as Bifinity. They also closed down Mastercard payments in several South Asian and American countries.
Now, they decided their long-term support of the BUSD token is out. BUSD on Binance was one of the major references of the crypto exchange. Everyone knew this token associated with Binance. Now, the future of the Binance token (BUSD) is dark. It will be a slow step-by-step process to remove the stablecoin from the world's largest exchange.
Binance has already announced on Twitter, providing the major details of the new development and how users can react to it. More importantly, if you are holding BUSD on Binance or other wallets, this directly affects you, and you should take action immediately.
So, Binance says they will gradually remove their support for the BUSD token. Hence, they have provided guidance on how users can liquidate their tokens before further effects. Apparently, their new development came up after the company handling the stablecoin minting, Paxos, halted their operations. Hence, many products and services Binance supported were affected. This is why they are closing down their support on the BUSD token.
"As Paxos has halted minting of new BUSD, Binance will gradually cease support for BUSD products. Announcements will be released for any impacted services. Please be assured that BUSD will always be backed 1:1 by USD.
Binance will continue to support multiple stablecoins and digital assets on its platform. Users are encouraged to convert their BUSD assets into other available assets on Binance prior to February 2024. Users may trade their BUSD balances for FDUSD at zero trading fees, or convert their BUSD balances to FDUSD at 1:1," Binance said in their announcement.
As Paxos has halted minting of new BUSD, #Binance will now gradually remove support for the stablecoin on our platform.
— Binance (@binance) August 31, 2023
BUSD will always remain backed 1:1 by USD, and we continue to support a wide range of other stablecoins.
Find more details below.
Step-by-step Process of How the Removal of Support Will Happen
To keep their users updated, Binance already provided guidance on how the whole removal of BUSD will happen on the network. One of the first things that will happen is that Binance will suspend BUSD borrowings on Cross Margin.
"At 2023-09-07 06:00 (UTC), Binance will suspend BUSD borrowings on Cross Margin. From 2023-10-19 06:00 (UTC), Cross Margin and Portfolio Margin users will no longer be able to transfer in additional BUSD as new collateral to Cross Margin Wallet. Users can still transfer in other tokens as collateral," Binance said. This will happen on 7th September.
The crypto exchange will be removing support for BUSD plan subscriptions on Auto-Invest starting on September 15th. Additionally, BUSD subscriptions on Simple Earn Flexible Products will also be removed, but this will happen on October 13th, nearly a month later. Please note that BUSD will still be supported on the Dual Investment until December 31st, 2023. Finally, in February 2024, the support for BUSD will officially end.