Breaking News
Get 40% Off 0
👀 Reveal Warren Buffett's stock picks that are beating the S&P 500 by +174.3% Get 40% Off

Paxos in talks with U.S. SEC over Binance stablecoin- internal email

Published Feb 21, 2023 09:00AM ET Updated Feb 21, 2023 10:31AM ET
Saved. See Saved Items.
This article has already been saved in your Saved Items
 
© Reuters. FILE PHOTO: People exit the headquarters of the U.S. Securities and Exchange Commission (SEC) in Washington, D.C., U.S., May 12, 2021. Picture taken May 12, 2021. REUTERS/Andrew Kelly/File Photo/File Photo

By Hannah Lang

(Reuters) -The firm behind Binance's stablecoin, Paxos Trust Company, is in discussions with the U.S. Securities and Exchange Commission after the regulator told the company it should have registered the token as a security, according to an internal email from Paxos' chief executive officer.

"We are engaged in constructive discussions with the SEC, and we look forward to continuing that dialogue in private," said Paxos CEO Charles Cascarilla in an email sent on Saturday to Paxos employees which was seen by Reuters.

He added that if necessary, Paxos would defend its position that Binance USD is not a security through litigation.

An SEC spokesperson declined to comment. Paxos declined to comment beyond the email.

The New York Department of Financial Services (NYDFS) said in a consumer alert on Feb. 13 that it had ordered Paxos to stop minting Binance USD, the third biggest stablecoin with about $16 billion in circulation.

In turn, Paxos said it would stop issuing new Binance USD from Feb. 21, but would continue to support and redeem the tokens until at least February 2024.

Cascarilla said the company's decision to end its relationship with Binance was separate from the NYDFS directive and the communication it has had with the SEC over Binance USD.

"The market has evolved and the Binance relationship no longer aligns with our current strategic priorities," he said.

Binance did not immediately respond to a request for comment, but has said it would continue to support Binance USD for the foreseeable future.

Cascarilla said that Paxos was still working with the SEC towards the publication of its application to obtain a clearing agency license, and with the U.S. Office of the Comptroller of the Currency (OCC) to get final approval for its national trust bank charter.

The OCC declined to comment.

Stablecoins, digital tokens typically backed by traditional assets designed to hold a steady value, have emerged as one of the key cogs in the crypto economy. They are used for trading between volatile tokens like bitcoin and, in some emerging economies, as a means to protect savings against inflation.

Paxos in talks with U.S. SEC over Binance stablecoin- internal email
 

Related Articles

Add a Comment

Comment Guidelines

We encourage you to use comments to engage with other users, share your perspective and ask questions of authors and each other. However, in order to maintain the high level of discourse we’ve all come to value and expect, please keep the following criteria in mind:  

  •            Enrich the conversation, don’t trash it.

  •           Stay focused and on track. Only post material that’s relevant to the topic being discussed. 

  •           Be respectful. Even negative opinions can be framed positively and diplomatically. Avoid profanity, slander or personal attacks directed at an author or another user. Racism, sexism and other forms of discrimination will not be tolerated.

  • Use standard writing style. Include punctuation and upper and lower cases. Comments that are written in all caps and contain excessive use of symbols will be removed.
  • NOTE: Spam and/or promotional messages and comments containing links will be removed. Phone numbers, email addresses, links to personal or business websites, Skype/Telegram/WhatsApp etc. addresses (including links to groups) will also be removed; self-promotional material or business-related solicitations or PR (ie, contact me for signals/advice etc.), and/or any other comment that contains personal contact specifcs or advertising will be removed as well. In addition, any of the above-mentioned violations may result in suspension of your account.
  • Doxxing. We do not allow any sharing of private or personal contact or other information about any individual or organization. This will result in immediate suspension of the commentor and his or her account.
  • Don’t monopolize the conversation. We appreciate passion and conviction, but we also strongly believe in giving everyone a chance to air their point of view. Therefore, in addition to civil interaction, we expect commenters to offer their opinions succinctly and thoughtfully, but not so repeatedly that others are annoyed or offended. If we receive complaints about individuals who take over a thread or forum, we reserve the right to ban them from the site, without recourse.
  • Only English comments will be allowed.
  • Any comment you publish, together with your investing.com profile, will be public on investing.com and may be indexed and available through third party search engines, such as Google.

Perpetrators of spam or abuse will be deleted from the site and prohibited from future registration at Investing.com’s discretion.

Write your thoughts here
 
Are you sure you want to delete this chart?
 
Post
Post also to:
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Thanks for your comment. Please note that all comments are pending until approved by our moderators. It may therefore take some time before it appears on our website.
 
Are you sure you want to delete this chart?
 
Post
 
Replace the attached chart with a new chart ?
1000
Your ability to comment is currently suspended due to negative user reports. Your status will be reviewed by our moderators.
Please wait a minute before you try to comment again.
Add Chart to Comment
Confirm Block

Are you sure you want to block %USER_NAME%?

By doing so, you and %USER_NAME% will not be able to see any of each other's Investing.com's posts.

%USER_NAME% was successfully added to your Block List

Since you’ve just unblocked this person, you must wait 48 hours before renewing the block.

Report this comment

I feel that this comment is:

Comment flagged

Thank You!

Your report has been sent to our moderators for review
Continue with Google
or
Sign up with Email