- Paxos has received a termination notice from the SEC, concluding its investigation of BUSD
- The SEC no longer intends to take enforcement action against BUSD
- Paxos Trust Company believes it will promote globalization and adopt stablecoins, especially for enterprises
- Paxos has won in resolving legislative issues and freed itself from recent constraints
As a reminder, in February 2023, the SEC sent Paxos a Wells Notice designating the propriety of a potential action to determine whether BUSD should be treated as a security.
This introduced more than a year of uncertainty for Paxos, affecting its ability to partner with new companies and organizations.
Is Paxos to Be Congratulated?
Paxos received a letter from the SEC suspending its investigation. Their representatives commented as follows on their website:
“Paxos Trust Company has always maintained that its USD-backed stablecoins are not securities under federal securities laws and that the Wells Notice was unwarranted and unjustified. We are proud of our relentless advocacy for stable-value digital assets and that the SEC staff determined it will not bring enforcement action against Paxos in connection with BUSD.
“We believe this development will unlock a new wave of stablecoin adoption by leading global enterprises. Well-designed stablecoins with strong consumer protections – like those issued by Paxos – will transform the financial system in payments, settlement, and remittance use cases. This transformative technology will make the financial system more stable, accessible, and transparent.
“Paxos has and always will prioritize the safety of customer assets. Paxos-issued stablecoins are always backed 1:1 with US dollar-denominated reserves, fully segregated and held in bankruptcy remote accounts. Paxos is the only issuer to secure regulatory oversight to introduce safe solutions that will drive significant innovation across the global financial system.””
Stablecoins seem to be starting to activate. First, the USDC was regulated in the EU and later minted additional coins on the Solana Network. Now, BUSD is gearing up for a larger scale and adaptation.
Should we expect a strong move from USDT now? Let’s keep a close eye on stablecoins.
