Share this article
Aave Community Mulls Freezing Binance Stablecoin Amid SEC Pressure
As circulating supply trends to zero, the lack of growth could "hurt peg arbitrage opportunity and asset peg," one community member said.
Updated May 9, 2023, 4:08 a.m. Published Feb 13, 2023, 2:44 p.m.
Members of the Aave community are consider a proposal to freeze Binance's BUSD stablecoin on the platform after the token's issuer, Paxos, was sued by the Securities and Exchange Commission Monday.
Aave is a decentralized finance protocol (DeFi) that allows users to lend, borrow and stake with others through smart contracts.
STORY CONTINUES BELOW
Don't miss another story.Subscribe to the Crypto Daybook Americas Newsletter today. See all newsletters
A governance proposal by Aave community member MarcZeller said that as Paxos will no longer issue new BUSD tokens, the supply will trend to zero, which could "hurt peg arbitrage opportunity and asset peg."
Though there is no risk to the protocol, "BUSD has no prospect for growth," MarcZeller added.
Thus far, the proposal has received a series of positive responses, with one member going further and suggesting Aave liquidate its BUSD holdings to mitigate further risks.
Binance's BUSD stablecoin fell from its U.S. dollar peg earlier Monday as investors attempt to safeguard their holdings by moving funds into other stablecoins including tether (USDT) and USD coin (USDC).
More For You
What to know:
- As of October 2025, GoPlus has generated $4.7M in total revenue across its product lines. The GoPlus App is the primary revenue driver, contributing $2.5M (approx. 53%), followed by the SafeToken Protocol at $1.7M.
- GoPlus Intelligence's Token Security API averaged 717 million monthly calls year-to-date in 2025 , with a peak of nearly 1 billion calls in February 2025. Total blockchain-level requests, including transaction simulations, averaged an additional 350 million per month.
- Since its January 2025 launch , the $GPS token has registered over $5B in total spot volume and $10B in derivatives volume in 2025. Monthly spot volume peaked in March 2025 at over $1.1B , while derivatives volume peaked the same month at over $4B.
More For You
Binance Overhauls Stablecoin Trading with Trump-Linked USD1
The exchange is adding new USD1 trading pairs and replaces BUSD collateral with the token.
What to know:
- Binance is expanding the use of World Liberty Financial's USD1 stablecoin on its platform.
- New trading pairs BNB/USD1, ETH/USD1, and SOL/USD1 will be available, and Binance will convert BUSD reserves to USD1.
- World Liberty Financial is a digital assets platform with close ties to the Trump family.
Top Stories
