Matrixport top manager: “Regulators will not attack other stablecoins”

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Head of Research DepartmentMatrixport crypto platform Markus Thielen believes that the claims of American regulators against Paxos, the issuer of BUSD, are not a direct attack on other stablecoins.

Markus Thielen suggestedthat perhaps Paxos Trust did not monitor its stablecoin strictly enough. Paxos may have violated its obligations to periodically assess risks and due diligence on Binance exchange clients and issued BUSD.

Thielen noted that Ethereum issued BUSD onamount of $11 billion, but $4.8 billion should also be released on the Binance Smart Chain. Therefore, the New York State Department of Financial Services (NYDFS) is concerned that this $4.8 billion may not be properly secured. However, Paxos stated that BUSD stablecoins are backed 1:1 by US dollars.

NYDFS recently requested that Paxoshas discontinued issuing BUSD due to several unresolved issues related to the regulation of Paxos and its relationship with Binance. Previously, the US Securities and Exchange Commission (SEC) accused Paxos of violating federal securities laws.

The top manager of Matrixport noted that nitpickingregulators to BUSD may be due to Binance mistakenly storing user funds and assets to back its own tokens in the same wallet. Due to regulatory actions regarding Paxos and BUSD, the cryptocurrency community fears that the same situation awaits other stable cryptocurrencies. However, Thielen believes that other stablecoin issuers should not fear attacks from regulators. He urged the community to stop worrying about BUSD's future.

“Binance shot itself in the foot, but the exchange has alreadyis working on it and the problem should be resolved. Does the binding break? No. We are no longer in a bear market, and during a bull trend it is worth focusing on the upside. So is it worth worrying? Thielen said.

However, the SEC is not going to relent ontowards cryptocurrencies. According to HedgewithCrypto, the number of SEC lawsuits against participants in the crypto sector has increased by 40% this year.