<\/p>\n
<br \/>\n<\/iframe><noscript><iframe loading=\"lazy\" src=\"https:\/\/servedbyadbutler.com\/adserve\/;ID=180936;size=320x100;setID=508113;type=iframe;click=CLICK_MACRO_PLACEHOLDER\" width=\"320\" height=\"100\" marginwidth=\"0\" marginheight=\"0\" hspace=\"0\" vspace=\"0\" frameborder=\"0\" scrolling=\"no\"><br \/>\n<\/iframe><\/noscript>\n<\/p>\n<p>Paxos, the leading regulated blockchain and tokenization infrastructure platform, recently announced that it will be terminating its collaboration with <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/companies\/binance\/\">Binance<\/a> for issuing the top stablecoin BUSD. This comes after the regulatory authority, NYDFS, ordered <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/new-york-regulator-orders-paxos-to-stop-creating-binance-busd\/\">Paxos to stop minting new BUSD<\/a> tokens citing abnormalities in the process. In response to this, a number of <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/glossary\/defi-decentralized-finance\/\">DeFi<\/a> initiatives have decided to put an end to the BUSD-based lending market with Aave being the first.<\/p>\n<h2>Aaave Freezes Its BUSD Reserves<\/h2>\n<p>A governance proposal for Aave that was submitted by community member Marc Zeller requested that <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/tag\/busd\/\">USD<\/a> reserves on the Ethereum network be frozen. according to the <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/governance.aave.com\/t\/arfc-freeze-busd-on-aave-v2\/11842\">proposal<\/a>the controversy surrounding Paxos & BUSD did not provide an immediate threat to Aave, however, the freeze could have a detrimental impact on Aave V2 operating on <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/tag\/ethereum\/\">Ethereum’s<\/a> marketplace.<\/p>\n<p><!-- WP QUADS Content Ad Plugin v. 2.0.59 --><\/p>\n<p><em><strong>Read More:<\/strong> <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/defi-lending-platforms\/\">Check Out The Top 10 DeFi Lending Platforms Of 2023<\/a><\/em><\/p>\n<p>The proposal suggested that the supply of the Paxos-issued stablecoin was destined to decrease and that the inability to mint additional <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/glossary\/token\/\">coins<\/a> would impair the prospects for peg arbitrage. Furthermore, since there is no genuine prospect of growth or utility for the stablecoin, it seemed that the fairest course of action for Aave would be to freeze its reserves and ask users to convert to another stablecoin among the variety offered by the protocol.<\/p>\n<p><!-- WP QUADS Content Ad Plugin v. 2.0.59 --><\/p>\n<p><a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/tag\/aave\/\">AAVE (AAVE)<\/a> is a decentralized lending platform that enables users to lend, borrow, and earn interest on <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/glossary\/cryptocurrency\/\">cryptocurrency<\/a> assets. The platform operates on a <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/glossary\/blockchain\/\">blockchain<\/a> and acts as a money market, where users can take part, either as borrowers or as lenders. Borrowers will have to pay fluctuating interest rates in order to borrow cryptocurrency from this platform. While doing so, the lenders contribute liquidity to the <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/markets\">crypto market<\/a> and receive an additional source of income in the form of interest.<\/p>\n<h2>More Lending Protocols In Queue?<\/h2>\n<p>It is anticipated that other leading DeFi lenders would take a similar approach because of their alleged exposure to the BUSD stablecoin. <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/tag\/pancakeswap\/\">Pancake Swap<\/a>, Balancer, Injective, Uma, and Dexe are some of the other lending protocols that fall under this category. BUSD has now emerged as a topic of heated discussion among market participants due to the widespread concern that regulatory bodies like New York Department of Financial Services (NYDFS), may soon implement additional restrictions on stablecoins such as USDT, TUSD, and USDC.<\/p>\n<p><!-- WP QUADS Content Ad Plugin v. 2.0.59 --><\/p>\n<p>The order to cease minting comes amid a slew of regulatory enforcement measures that have been taken by US watchdogs. The move was reportedly the result of a collaborative effort coordinated between the NYDFS and the Securities and Exchange Commission (SEC), and other regulators in the <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/tag\/united-states\/\">United States<\/a>, Gary Gensler’s SEC has also begun to take action against <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/glossary\/staking\/\">staking cryptocurrency<\/a> to. Crypto exchange <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/companies\/kraken\/\">Kraken<\/a> was recently ordered to pay a <a rel=\"nofollow noopener\" target=\"_blank\" href=\"https:\/\/coingape.com\/kraken-to-shut-down-this-feature-as-settlement-with-sec\/\">fine of $30 million<\/a> and to discontinue all of its digital asset staking services for US retail customers.<\/p>\n<p><em><strong>Also Read: <\/strong><a rel=\"nofollow noopener\" target=\"_blank\" title=\"Rich Dad Poor Dad Author Predicts \u201cValentine Day Massacre\u201d, Another\u00a0Crypto\u00a0Crash?\" href=\"https:\/\/coingape.com\/rich-dad-poor-dad-valentine-day-massacre-crypto-crash\/\">Rich Dad Poor Dad Author Predicts \u201cValentine Day Massacre\u201d, Another Crypto Crash?<\/a><\/em><\/p>\n<p><!-- WP QUADS Content Ad Plugin v. 2.0.59 --><\/p>\n<div class=\"TabDicA\">\n<div class=\"TBAcon \">\n<div class=\"authorFlip tabcS\" id=\"TabA138655\">\n<div class=\"authorBox\">\n<div class=\"author_Name\">\n<!--\n \n\n<div class=\"getAuthoname\">\n \n \n <\/div>\n\n \n--><\/p>\n<p>Pratik has been a crypto evangelist since 2016 & been through almost all that crypto has to offer. Be it the ICO boom, bear markets of 2018, Bitcoin halving to till now – he has seen it all. <\/p>\n<\/p><\/div>\n<div class=\"author_Image\">\n <noscript><img loading=\"lazy\" alt=\"\" src=\"https:\/\/secure.gravatar.com\/avatar\/5cf0f64b0c7425fc4b6ea3fbbbde702c?s=200&d=mm&r=g\" srcset=\"https:\/\/secure.gravatar.com\/avatar\/5cf0f64b0c7425fc4b6ea3fbbbde702c?s=400&d=mm&r=g 2x\" class=\"avatar avatar-200 photo\" height=\"200\" width=\"200\" decoding=\"async\"\/><\/noscript> <\/div>\n<\/p><\/div>\n<\/p><\/div>\n<div class=\"TabDesCm tabcS\" id=\"TabD138655\">\n<p> The content presented may include the personal opinion of the author and is subject to market conditions. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.<\/p>\n<\/div><\/div>\n<\/p><\/div>\n<\/p><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Paxos, the leading regulated blockchain and tokenization infrastructure platform, recently announced that it will be terminating its collaboration with Binance for issuing the top stablecoin BUSD. This comes after the regulatory authority, NYDFS, ordered Paxos to stop minting new BUSD tokens citing abnormalities in the process. In response to this, a number of DeFi initiatives […]<\/p>\n","protected":false},"author":2,"featured_media":94378,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[8],"tags":[188,183,185,186,187,184,189,150,182,190],"class_list":["post-94386","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-technology","tag-blockchain-tech","tag-blockchain-technology","tag-crypto-technology","tag-cryptocurrency-technology","tag-metaverse-technology","tag-nft-technology","tag-soul-bound-token","tag-tech","tag-technology","tag-token-technology"],"_links":{"self":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/94386","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/comments?post=94386"}],"version-history":[{"count":1,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/94386\/revisions"}],"predecessor-version":[{"id":94387,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/posts\/94386\/revisions\/94387"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media\/94378"}],"wp:attachment":[{"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/media?parent=94386"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/categories?post=94386"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/dripp.zone\/news\/wp-json\/wp\/v2\/tags?post=94386"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}