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Crypto exchange giant Binance has partnered with stablecoin provider Paxos to launch BUSD, a stablecoin backed by the US dollar, it announced in a press release today. It has regulatory approval from The New York State Department of Financial Services (NYDFS) so it can be sold to people living in New York.
The coin will start trading on Paxos’ and Binance’s exchange platforms later this month. Paxos will issue the coin and look after the reserves of dollars–and Paxos customers will be able to trade the coin for real US dollars. On Binance, meanwhile, BUSD will be traded against BTC, BNB, and XRP.
“We hope to unlock more financial services for the greater blockchain ecosystem through the issuance of BUSD, including more use cases and utility through the power of stable digital assets,” said Binance CEO Changpeng Zhao.
The stablecoin’s launch in New York—one of the strictest financial regulatory environments—puts Binance in good stead ahead of its forthcoming US launch, showing it can cooperate with regulators, if indirectly via a second company. While this doesn’t mean Binance’s upcoming US platform will be available in New York—it would require a BitLicense to do so—it helps to provide the exchange with a US-dollar stablecoin that customers can use.
“NYDFS’s approval of BUSD is a vital step towards long term stability in global crypto markets,” said Paxos CEO Rich Teo.
BUSD joins other stablecoins already issued on Binance’s native blockchain, including StableUSD and a GBP-backed stablecoin called Binance GBP.
While Binance has expanded its stablecoin offering, it continues to develop Venus, an initiative to create multiple stablecoins for itself and other companies on Binance Chain. A press release last month described Venus as an “independent, regional version” of Facebook’s Libra.
On top of the partnership, Paxos also announced it was launching its own gold-backed stablecoin. It’ll run on Ethereum but instead of being redeemable for US dollars, it can be swapped for gold, stored in a London vault.
Binance is one of the largest crypto exchanges by volume, and Paxos has its own eponymously-named, dollar-backed stablecoin, running as a token on the Ethereum network.