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Solana Unveils Token Extensions As SOL Bounces Back, Surging 5%

The Solana Foundation, a non-profit organization dedicated to decentralization, adoption, and security on the Solana network, has launched token extensions.  

Solana Token Extensions Gains Traction

According to a January 24 announcement, token extensions provide developers, enterprises, financial institutions, and Solana-native development teams with a comprehensive suite of turnkey solutions for advanced token functionality. Anatoly Yakovenko, co-founder of Solana and CEO of Solana Labs, commented on the launch, stating: 

Token extensions build on the characteristics that make Solana the ideal destination for developers. Solana is the first network to offer this level of integrated developer and user experience in a single token program. We’re already seeing the potential to build using token extensions via deployments from some of the most recognizable names in crypto.

Industry giants Paxos and GMO-Z.com Trust Company Inc. (GMO Trust) are leading the way in adopting token extensions. As announced by the Solana Foundation, these companies are “leveraging the benefits” of token extensions to issue stablecoins on the Solana blockchain. 

As previously reported, Paxos, a regulated blockchain and tokenization infrastructure platform, expanded its stablecoin issuance to the network in December. Similarly, GMO Trust announced the launch of the first regulated Japanese yen stablecoin and their own US dollar stablecoin on the Solana network. 

New Standards For Blockchain Compliance? 

Sheraz Shere, Head of Payments at the Solana Foundation, emphasized the appeal of the Solana network for enterprise-grade companies entering the web3 space. Shere stated: 

Companies like Visa, Worldpay, Stripe, Google, and Shopify have already seen the performance advantages inherent to the Solana network and have launched solutions and applications that are only possible on Solana. With token extensions, we are expanding what is possible for enterprise adoption of blockchain by natively enabling features that matter to large regulated enterprises.

Token extensions, designed to cater to builders across diverse industries such as stablecoins, real-world assets (RWA), and payments, offer a range of interesting features:

  • Transfer Hooks: Enables token issuers to exert control over token interactions, empowering developers to create intricate and flexible token mechanisms.
  • Transfer Fees: Provides the ability to charge fees for each token transfer, offering sustainable revenue models for different types of tokens built using token extensions.
  • Confidential Transfers: Utilizes zero-knowledge proofs to encrypt the transfer amount while publicly sharing the source, destination, and token type. This ensures compliance while preserving privacy.
  • Permanent Delegate Authority: Grants token issuers absolute authority over their tokens, particularly for those requiring revocation ability, such as licenses or credentials.
  • Non-transferability: Restricts token transfers to the issuer only, making it ideal for unique user identification and credentialing purposes.

Ultimately, with the launch of token extensions, Solana aims to position itself as a force in blockchain development, offering builders the tools to create new applications across various industries. 

Solana

The SOL token experienced a sharp drop of over 28% in the past 30 days, leading to a decline to the $79 level. However, the token has recovered in the past 24 hours with a 5% bounce, leading to a current trading price of $87.

Featured image from Shutterstock, chart from TradingView.com 

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Bye Bye Birdie: Binance Begins Process Of Axing BUSD Stablecoin

Binance crypto exchange announced in late August that it is moving to end support for its beloved BUSD stablecoin. This move comes amid the stablecoin’s run-in with regulators, leading to a halt in its production. And now, the exchange has started moving to begin the end of support for the stablecoin.

Binance Starts Burning Tokens

Binance took to its official X (formerly Twitter) account on Thursday, September 14, to announce that it would begin burning a number of Binance-pegged tokens. Among the five tokens listed to be burned, four were BUSD tokens across different blockchains.

According to the announcement, the Binance-pegged tokens would be burned on the listed blockchains, and then the exchange would release the equivalent amount of tokens that were initially used as collateral on their native networks.

The BUSD tokens listed across four networks include BUSD on the Polygon (MATIC) network, BUSD on the Tron (TRX) network, BUSD on BSC, and BUSD (BNB). In addition to these, the exchange also revealed that the TUSDOLD on BSC would be burned as well, making it the only token on this list that is not BUSD.

The collateral in this case will be the equivalent of the Binance-pegged tokens that are burned. So if 1,000 BUSD on the MATIC network is burned, then the equivalent on the native blockchain will be released by the exchange.

Fire In The BUSD Camp

The BUSD stablecoin first came under fire in early 2023 when the United States Securities and Exchange Commission (SEC) issued a Wells Notice to issuer Paxos alleging that the stablecoin was an unregistered security. The regulator, through this, made its intention to pursue legal action known.

Following the move by the SEC, the New York State Department of Financial Services (NYDFS) asked the issuer to stop printing new tokens. The NYDFS’s concern mainly bordered on Paxos’ relationship with Binance, and eventually, the BUSD issuer decided to cut ties with the crypto exchange.

Since the initial move by regulators, the stablecoin has suffered in terms of usage and market cap. The stablecoin which was once a top 10 crypto by market cap has since seen its market cap decline to $2.5 billion, making it the 26-largest cryptocurrency as of the time of this writing.

Binance has also announced plans to stop offering support for the stablecoin completely by 2024. Paxos also revealed that it will cease all BUSD redemptions in February 2024, and Binance’s complete withdrawal is expected to come shortly after this.

Nevertheless, the stablecoin continues to maintain its dollar peg quite well. It is still trading at a 1:1 parity with the United States dollar and has rarely dipped below $1 amid the regulatory storm.

Binance BUSD market cap chart from Tradingview.com

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The Real Reason Behind That Bitcoin Transaction With A $500,000 Fee Has Been Revealed

In a surprising twist of events, Paxos has come forward to take the blame for the $500,000 Bitcoin fee payment after PayPal was accused of being the party responsible for the exorbitant fee transfer. 

Paxos Comes Forward As Guilty Party

Paxos, a New York-based blockchain infrastructure company and the issuer of PayPal USD (PYUSD) and Pax Dollar (USDP), recently admitted responsibility for a substantial $510,000 Bitcoin fee payment, the highest fee ever paid in US dollars for a single Bitcoin transaction. 

The story began when several blockchain sleuths noticed the abnormally high Bitcoin network transaction fee of 19.89 BTC attached to a relatively small Bitcoin transfer of 0.074 BTC. Usually, BTC network fees range from $1-$5 and sometimes $50 when network activities are high, so the fee instantly piqued interest. 

An analysis by an X (formerly Twitter) user, Mononautical claimed that the entity behind the overly paid Bitcoin fee transaction was PayPal because the address behind the transaction was similar to one tagged as PayPal on OXT, a mobile block explorer for Bitcoin. In light of these rumors, Paxos has come forward to debunk the statement, clarifying that it was indeed an error on their part.

Paxos has stated that the substantial BTC fee was caused by a bug error on the Bitcoin transfer. However, the blockchain infrastructure company has begun making plans to reclaim the lost funds from BTC miners involved in the transfer. 

“Paxos overpaid the BTC network fee on Sept. 10, 2023. This only impacted Paxos’ corporate operations. Paxos clients and end users have not been affected and all customer funds are safe,” the blockchain service provider said.

Bitcoin price chart from Tradingview.com

Bitcoin Miners Contemplate Refund

Presently, Bitcoin miners are contemplating refunding the significant Bitcoin network fee paid by Paxos for a 0.074 BTC transfer. The mining company involved in the transfer was Stakefish, a leading validator for proof of stake blockchains. 

The CEO and Founder of Stakefish, Chun Wang announced in a post on X that the individual behind the overly paid BTC fee transaction should come forward and reclaim their funds within three days. 

Following the announcement, a claim was made after three days, however, Wang has been uncertain about releasing the Bitcoin fee funds. He stated that he felt contrite about giving consent to the reimbursement and asked if he should split the funds between miners and Paxos. 

A few members of the crypto community had suggested distributing the funds to miners, while others proposed splitting the funds equally between Paxos and miners. All things considered, the loss of the Bitcoin fee funds has been a huge blow to Paxos, raising concerns about the firm’s security. 

The crypto infrastructure provider has also been on the United States Securities and Exchange Commission’s (SEC) radar, for allegedly infringing several investor protection laws in issuing the BUSD stablecoin. Paxos also faces significant regulatory challenges in several regions including Canada and New York.

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FDUSD Market Cap Jumps By 20% Following Binance Directive

The First Digital USD (FDUSD) stablecoin has recorded a significant rise in its market cap following an announcement by the Binance exchange in August. FDUSD, a dollar-pegged stablecoin, was recently launched on June 1, 2023, debuting on the Ethereum network and the BNB Smart Chain. The token was officially listed for specific trading pairs on the crypto exchange in July.

Binance’s Directive Drives Adoption Of FDUSD 

On August 31, Binance confirmed reports of intention to halt support for Binance USD (BUSD) stablecoin following the regulatory embargo on the token’s issuance.

Back in March, The New York Department of Financial Services (NYDFS) had ordered Paxos Trust, the issuing company of BUSD, to cease minting the stablecoin. Since then, BUSD’s market supply has taken a nosedive, crashing by over 80% in the last eight months. 

According to an official post, the exchange will begin the gradual termination of all BUSD products on its platform, urging its 150 million customers to swap their BUSD tokens for other assets before February 2024. 

In particular, the crypto exchange encouraged users to convert their BUSD to FDUSD, touting incentives such as zero trading fees and a 1:1 direct swap ratio. 

According to data from CoinMarketCap, FDUSD’s market cap value has grown by 21.49% from August 31, rising from $324.75 million to its current value of $394.68 million.

This indicates that Binance’s promotion of FDUSD as a BUSD alternative is paying dividends, resulting in a rapid rise in the former’s adoption over the last few days. 

For context, the market cap metric represents the total value of a cryptocurrency based on its market price and the number of circulating tokens. Since FDUSD is a stablecoin with a fixed value of $1, CoinMarketCap’s data means that over 70 million FDUSD tokens entered circulation over the past week. 

In addition, according to the DeFi analytics platform, DeFiLlama, FDUSD now ranks as the ninth largest stablecoin in the crypto market ahead of other popular assets such as Gemini USD (GUSD). 

Binance

Binance Announces New FDUSD Trading Pairs

In other news, Binance unveiled three new FDUSD trading pairs on September 6, maintaining its stablecoin support. 

These trading pairs are DOGE/FDUSD, SOL/FDUSD, and XRP/FDUSD, which will become available for trading on September 7 at exactly 08:00 UTC.

This move comes a week after Binance announced the “gradual” discontinuation of its support for the BUSD token while directing users to convert their BUSD token to other assets. The exchange has begun discontinuing by delisting eight BUSD isolated and cross-margin pairs.

Following these announcements, the BUSD market fall continues, with the token’s market share now valued at an all-time low of $2.73 billion. More data from DeFiLlama shows that the BUSD market cap is down by 4.16% and 12.23% in the last one and seven days, respectively. 

Nevertheless, BUSD remains an important item in the market, ranking as the fifth largest stablecoin in the crypto space.

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Binance To Delist Eight BUSD Trading Pairs Soon, End Full BUSD Support By 2024

The world’s largest exchange, Binance, has announced plans to delist eight Binance USD (BUSD) trading pairs as the company looks to withdraw full support of the stablecoin by 2024. This follows increased regulatory pressure on the stablecoin in 2023, which has led to a drastic decline in its market share so far. 

Binance To Delete Nine Margin Trading Pairs By September 7

In a blog post on Wednesday, Binance laid out intentions to delist eight BUSD cross margin and isolated trading pairs. These include AMB/BUSD, DASH/BUSD, FIDA/BUSD, HARD/BUSD, HOT/BUSD, NULS/BUSD, PORTO/BUSD and REQ/BUSD. In addition, the exchange will also be deleting the IOST/BTC margin trading pair. 

Related Reading: Binance Will Halt These 39 Liquidity Mining Pools This Week

According to Binance, the delisting process will occur in two stages. Firstly, the exchange will suspend all isolated margin borrowing for these specific pairs on September 1, 2023, at 06:00 (UTC).

Thereafter, Binance will close all users’ positions, terminate any pending order, and enable an automatic settlement before proceeding to delist these pairs from its isolated margin market on September 7, 2023, at 06:00 (UTC). On the same day and at the same time, these trading pairs will also be removed from Binance’s cross margin market. 

Binance has stated that users would not be permitted to modify their trading positions during the delisting procedure. Thus, they are advised to close all open positions and transfer their assets from margin wallets to spot wallets prior to September 7 to avoid any possible losses.

In the announcement, the exchange did not state a specific reason for delisting eight BUSD pairs at once. However, emerging reports indicate that this move is part of a much larger plan by the crypto exchange. 

Binance

Binance To Cease Full Support For BUSD In 2024?

According to several posts on the social media platform X, Binance plans to terminate its support for its native BUSD stablecoin by 2024, urging users to convert the token to other crypto assets. This development was revealed via a pop-up notification on the exchange’s mobile app.

Although there was no specific date in the notification, it was stated that Paxos Trust, BUSD’s issuer and operator, will stop BUSD redemption by February 2024. Following this, Binance will gradually withdraw its support for the stablecoin.

As earlier stated, the BUSD token has been affected by the high level of regulatory scrutiny faced by the cryptocurrency industry in 2023. 

Related Reading: Bitcoin Cash (BCH) Records Surprising 15% Rally – What’s Behind It?

In February, the New York Department of Financial Services ordered Paxos to halt the issuance of BUSD, citing “several unresolved issues related to Paxos’ oversight of its relationship with Binance regarding Paxos-issued BUSD.”

Following this directive, BUSD has lost over 80% of its market cap, falling from $16.13 billion on February 9 to its current value of $3.1 billion based on data from Tradingview.