Paxos Positive in Constructive Dialogue with SEC on BUSD Security Registration

02/21/2023 13:56 • NFT Newsflash • 130 views

According to reports, Reuters quoted an internal email from the chief executive of Paxos as reporting that Paxos was having a constructive discussion with the Securities and Exchange Commission. Previously, the company disclosed that the regulatory authority told the company that it should register BUSD as a security.

Paxos is having constructive discussions with the Securities and Exchange Commission

Interpret the above information:

Paxos, a regulated financial institution that uses blockchain technology to digitize and mobilize assets, has informed Reuters that it is having a constructive discussion with the Securities and Exchange Commission (SEC) over the registration of its BUSD stablecoin as a security. The news follows a disclosure by Paxos that the regulatory authority had ordered the New York-based company to register BUSD as a security.

The dialogue between Paxos and SEC is seen as positive by the company’s Chief Executive Officer, Charles Cascarilla. In an internal email, he stated that the exchange of information and ideas with the regulatory body had been productive, and that Paxos was optimistic that it would be able to find a solution that would satisfy the SEC’s requirements. According to Cascarilla, Paxos has been in contact with the SEC for more than a year regarding the registration and regulation of stablecoins.

BUSD stands for Binance USD, and as its name suggests, it is a stablecoin pegged to the US dollar, with each BUSD unit backed by a corresponding US dollar reserve. The BUSD stablecoin is an ERC-20 token, meaning that it runs on the Ethereum blockchain. In addition, BUSD is issued by Paxos Trust Company, which is regulated by the New York State Department of Financial Services (NYDFS). According to Paxos, BUSD is being used by companies in sectors such as payments, trade finance, and real estate.

The SEC’s push for BUSD’s security registration highlights the commission’s growing concern over stablecoins, which it views as a potential threat to investors, given their lack of regulation and the lack of transparency around their assets. By registering BUSD as a security, the SEC would gain greater oversight over the token’s operations, thereby increasing investor protection. Paxos, for its part, has stated that it is committed to complying with regulatory requirements and that it intends to work with the SEC to ensure a satisfactory outcome.

In conclusion, the positive and productive dialogue between Paxos and the SEC over the registration of BUSD as a security is a step forward in the regulation of stablecoins. The increasing interest of regulators in stablecoins such as BUSD highlights the growing demand for greater transparency and accountability in the cryptocurrency space. It is hoped that the dialogue between Paxos and the SEC will lead to a satisfactory outcome that will benefit investors while supporting the growth of innovative financial products and services.

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Paxos Positive in Constructive Dialogue with SEC on BUSD Security Registration

Paxos is having constructive discussions with the Securities and Exchange Commission

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