Coinbase, the popular cryptocurrency exchange, has announced on Twitter that it will halt trading of the Binance USD (BUSD) stablecoin on March 13. The third-largest stablecoin by market capitalization, BUSD no longer meets Coinbase’s “listing standards”, according to the tweet. The suspension will apply to Coinbase’s various trading platforms, including Coinbase Pro, Coinbase Exchange, Coinbase Prime, and Coinbase.com.
We regularly monitor the assets on our exchange to ensure they meet our listing standards. Based on our most recent reviews, Coinbase will suspend trading for Binance USD (BUSD) on March 13, 2023, on or around 12pm ET.
— Coinbase Assets (@CoinbaseAssets) February 27, 2023
Despite the suspension of trading, BUSD holders will still be able to access their funds and withdraw them at any time, the exchange said. A Coinbase spokesperson said the decision to suspend trading for BUSD was based on the company’s “internal monitoring and review processes” and that the digital asset listings group “evaluates assets against legal, compliance, and technical security standards.”
Coinbase’s move follows a Wells notice issued by the United States Securities and Exchange Commission (SEC) to Paxos Trust, the issuer of BUSD, around February 12, and a subsequent order by the New York State Department of Financial Services for Paxos to stop issuing BUSD on February 13. These events caused BUSD’s market cap to plummet by $2 billion within days. Despite these developments, Coinbase insisted on Twitter that “stablecoins are not securities”, and Paxos was reported to be in constructive talks with the SEC on February 21.