Blockchain data reveals that Paxos, the company responsible for the $16 billion Binance USD (BUSD) stablecoin, has destroyed more than $700 million worth of BUSD tokens after announcing on Monday that it would cease releasing the cryptocurrency due to increasing legal pressure. A Paxos Treasury cryptocurrency wallet moved $703 million worth of BUSD tokens to a burn handle over the course of 27 hours beginning on Monday morning, effectively removing the currencies from existence, according to data from blockchain intelligence company Nansen.
Just under two hours after the introduction, at 13:47 UTC on Monday, Paxos Treasury sent the initial transaction for $144.5 million worth of BUSD, according to statistics from blockchain monitoring tool Etherscan. In the following 27 hours, eight additional trades totaling $559 million took place. BUSD is a dollar-pegged stablecoin that holders can exchange for dollars at any moment thanks to its backing by short-term treasury and other assets that resemble cash. According to rules from the New York Department of Financial Services, the state's primary financial regulating body, U.S.-based fintech company Paxos releases the token.
The action indicates that investors are quickly selling BUSD. The repurchase of $700 million in a little over a day amounted to almost 6% of the total coins in circulation. The CEO of Binance, the largest cryptocurrency exchange in the world by trading activity, Changpeng “CZ” Zhao, tweeted on Monday that the market cap of the BUSD “will only drop with time.”
On Monday morning, word spread that the U.S. The Securities and Exchange Commission (SEC) had served the company a Wells notice for issuing unregistered securities, indicating that the regulator will take enforcement action soon. The NYDFS is currently looking into the company and has told Paxos to halt creating additional Binance USD (BUSD) coins.
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