The Founder and CEO of Binance spoke in an AMA (Ask Me Anything) Twitter about various hot topics in the cryptocurrency community, one of them being the US authorities’ crackdown on BUSD.
He suggested that the global cryptocurrency ecosystem would benefit if dollar-pegged stablecoins faced rivals from other such tokens pegged to different fiat currencies.
Not just in USD
The cryptocurrency community has witnessed increased regulatory scrutiny over the past few days from various US watchdogs. It all started with rumors that the SEC would crack down on staking, which came to fruition a few days later when the securities regulator halted Kraken’s staking services.
Amid growing fears that this crackdown will only escalate and possibly affect Coinbase, which has a similar platform, the company’s shares fell, ending the week with a massive drop of 22%. Cryptocurrency asset prices also declined.
However, that was just the beginning, as the SEC then allegedly sent a Wells notice to Paxos suggesting that it might take legal action against the issuer of Binance USD for selling unregistered securities with the stablecoin. .
Hours later, the New York Department of Financial Services ordered Paxos to stop issuing BUSD. Binance and CZ, in particular, have weighed in on the matter, claiming that BUSD is entirely issued and held by Paxos.
In an AMA from today, Zhao said the industry will eventually need a more diverse selection of stablecoins, including those pegged to other fiat currencies like the Singapore dollar and Japanese yen. In fact, he added that a yen-based stablecoin issuer had already contacted the world’s largest exchange.
Responding to reports that Circle warned NYDFS that Binance was unable to maintain adequate token reserves, CZ said he didn’t believe the American company would because it might also come back to haunt him.
FTX and Terra Collapses Changed Everything
The United States has always had a controversial approach to crypto regulation, but Zhao claimed that the Terra and FTX crashes in 2022 changed everything. He explained that watchdogs have become “stricter”, as many traditional finance companies and banks no longer want to cooperate with participants in the digital asset industry.
CZ admitted that Binance has lost traditional banking partners, possibly referring to the recent drama with Signature Bank.
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