Aave community initiates proposal to freeze BUSD with Paxos’ halt of token minting imminent News ▸ Binance ▸ Stablecoins
Aave community initiates proposal to freeze BUSD with Paxos’ halt of token minting imminent
Following Paxos move to halt minting BUSD, the Aave community has initiated a proposal to freeze its BUSD holding on Aave V2 Ethereum market.
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Updated: Feb. 13, 2023 at 5:13 pm UTC
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The Aave community is currently considering a proposal to freeze the BUSD reserve on the Aave V2 market in light of Paxos’ move to stop minting BUSD.
BUSD issuer Paxos announced on Feb. 13 that it would cease minting BUSD from Feb. 21, 2023, but the token will remain fully supported by Paxos and redeemable to onboarded customers through at least February 2024.
Aave integration lead Marc Zeller has initiated a proposal to freeze the BUSD holding on Aave V2, as he believes the circulating supply of BUSD is expected to fall near zero over time, as there is no potential for BUSD to continue growing.
“It seems that the most reasonable path for Aave is to freeze this reserve and invite users to switch to another stablecoin among the diversity present in Aave,” Marc said.
Currently, about $11.57 million worth of BUSD is supplied on the Aave V2 Ethereum market, while about $10,500 BUSD is held in the DAO collector contract.
The proposal will undergo the standard governance process for the Aave community to vote on the optimal choice needed to preserve the DAO Treasury.
Following the Paxos-BUSD freeze, Binance CEO Changpeng Zhao said that his exchange might move away from using BUSD as the main trading pair if the issue persists.
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Christian Nwobodo
Christian is a crypto-curious nerd who loves to investigate how protocols work under the hood. Christian is interested in DeFi protocol research, token economics, and on-chain analytics.
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BUSD is a stablecoin issued by Paxos in partnership with Binance..
Aave
$84.8262
Aave is an open source and non-custodial protocol enabling the creation of money markets.
Binance
Binance is a global cryptocurrency exchange that provides a platform for trading more than 100 cryptocurrencies.
Changpeng Zhao, popularly known as “CZ,” is a notable figure in the cryptocurrency world, primarily for founding and leading Binance, the world’s leading cryptocurrency exchange by trading volume.
