Aave community considers freezing BUSD reserves

The Aave community members are considering a proposal that seeks to freeze BUSD reserves on Aave V2 following the recent crackdown on the stablecoin by regulators.
Dot
February 23, 2023
Ayush Pande

As a tech enthusiast who's always on the prowl for the latest developments concerning crypto and hardware, you can find him covering news stories or tinkering with PCs.

TABLE OF CONTENTS
Stani Kulechov; Photo Source: Aave
The governance proposal stated, "It seems that the most reasonable path for Aave is to freeze this [BUSD] reserve and invite users to switch to another stablecoin among the diversity present in Aave." 

The Aave (AAVE) community members are considering a proposal that seeks to freeze the Binance USD (BUSD) reserves on Aave V2 following the recent crackdown on the stablecoin by regulators.

The proposal was submitted by Aave’s Integrations Lead Marc Zeller. It stated that recent developments can cause the remaining supply of BUSD to trend to zero after April. 

The governance proposal added that since Paxos cannot mint new BUSD tokens, using the stablecoin could hurt the asset peg. Therefore, the proposal intends to freeze the remaining BUSD reserves and ask users to switch to another stablecoin on the Aave protocol.



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The proposal has gained some support among the Aave community as of writing.

On February 10, reports emerged that Paxos was under investigation by the New York regulator NYDFS. A few hours ago, the NYDFS ordered Paxos to stop issuing BUSD, causing the crypto community to worry about the future of the stablecoin.

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Ayush Pande

Ayush Pande is a hardware, gaming, and crypto writer based in India. He's a tech enthusiast who's fascinated by the potential of blockchain technology.

Connect with Ayush on LinkedIn

Aave community considers freezing BUSD reserves

HomeDeFi
Contents
Stani Kulechov; Photo Source: Aave
The governance proposal stated, "It seems that the most reasonable path for Aave is to freeze this [BUSD] reserve and invite users to switch to another stablecoin among the diversity present in Aave." 

The Aave (AAVE) community members are considering a proposal that seeks to freeze the Binance USD (BUSD) reserves on Aave V2 following the recent crackdown on the stablecoin by regulators.

The proposal was submitted by Aave’s Integrations Lead Marc Zeller. It stated that recent developments can cause the remaining supply of BUSD to trend to zero after April. 

The governance proposal added that since Paxos cannot mint new BUSD tokens, using the stablecoin could hurt the asset peg. Therefore, the proposal intends to freeze the remaining BUSD reserves and ask users to switch to another stablecoin on the Aave protocol.



Get Our Free Newsletter

Subscribe to our newsletter to get tips, our favorite services, and the best deals on Bitcompare-approved picks sent to your inbox


The proposal has gained some support among the Aave community as of writing.

On February 10, reports emerged that Paxos was under investigation by the New York regulator NYDFS. A few hours ago, the NYDFS ordered Paxos to stop issuing BUSD, causing the crypto community to worry about the future of the stablecoin.

Written by
Author's profile picture

Ayush Pande

Ayush Pande is a hardware, gaming, and crypto writer based in India. He's a tech enthusiast who's fascinated by the potential of blockchain technology.

Connect with Ayush on LinkedIn
Ayush Pande

As a tech enthusiast who's always on the prowl for the latest developments concerning crypto and hardware, you can find him covering news stories or tinkering with PCs.

The governance proposal stated, "It seems that the most reasonable path for Aave is to freeze this [BUSD] reserve and invite users to switch to another stablecoin among the diversity present in Aave." 

The Aave (AAVE) community members are considering a proposal that seeks to freeze the Binance USD (BUSD) reserves on Aave V2 following the recent crackdown on the stablecoin by regulators.

The proposal was submitted by Aave’s Integrations Lead Marc Zeller. It stated that recent developments can cause the remaining supply of BUSD to trend to zero after April. 

The governance proposal added that since Paxos cannot mint new BUSD tokens, using the stablecoin could hurt the asset peg. Therefore, the proposal intends to freeze the remaining BUSD reserves and ask users to switch to another stablecoin on the Aave protocol.



Get Our Free Newsletter

Subscribe to our newsletter to get tips, our favorite services, and the best deals on Bitcompare-approved picks sent to your inbox


The proposal has gained some support among the Aave community as of writing.

On February 10, reports emerged that Paxos was under investigation by the New York regulator NYDFS. A few hours ago, the NYDFS ordered Paxos to stop issuing BUSD, causing the crypto community to worry about the future of the stablecoin.

Written by
Author's profile picture

Ayush Pande

Ayush Pande is a hardware, gaming, and crypto writer based in India. He's a tech enthusiast who's fascinated by the potential of blockchain technology.

Connect with Ayush on LinkedIn
Written by
Ayush Pande