SEC Ends Investigation into Paxos, Declares BUSD not a Security

SEC Ends Investigation into Paxos, Declares BUSD not a Security

The United States Securities and Exchange Commission (SEC) has halted its investigation into Paxos, the company behind the Binance USD (BUSD) stablecoin. The SEC's probe reportedly ended after the agency determined that BUSD does not meet the criteria to be classified as a security. The SEC's decision is a significant development for the cryptocurrency industry and could potentially pave the way for greater regulatory clarity around stablecoins. BUSD, which is pegged to the US dollar, is one of the most widely used stablecoins in the world. Its non-security classification could indicate that the SEC is taking a more nuanced approach to regulating cryptocurrencies. Prior to the investigation halt, the SEC was scrutinizing whether Paxos, BUSD's issuer, had registered the stablecoin as a security. However, the agency has now concluded that BUSD does not meet the definition of a security under US law. This means that BUSD will not be subject to the same regulatory requirements as other securities, such as stocks and bonds. The SEC's decision is a positive sign for the cryptocurrency industry. It suggests that the agency is willing to take a more flexible approach to regulating cryptocurrencies, and that it is not seeking to stifle innovation.