April 24, 2024

Binance Is Ending Support for USD Coin (USDC) Stablecoin on Tron Network

Crypto exchange giant Binance has announced plans to end support for the USD Coin (USDC) stablecoin on the Tron blockchain.

Binance’s announcement comes after USDC stablecoin issuer, Circle, announced plans to halt minting USDC on the Tron blockchain. At the time, Circle announced its decision stemmed from a need to boost trust, safety, and transparency for the stablecoin.

The stablecoin issuer halted minting the stablecoin on the Tron network as soon as it made the announcement. It later said it would phase out support for USDC minted on Tron gradually. Binance is now following suit, and will no longer accept deposits and withdrawals for TRC-20-based USDC.

Binance to Halt Support for TRC-20 USDC on April 15

Binance is the largest cryptocurrency exchange globally. Its decision to halt support for Tron-based USDC is bound to affect many users who now have until April 5 to make the necessary changes.

Cryptocurrency traders using the Binance exchange have 12 days to convert, transfer, or withdraw their USDC running on the Tron blockchain. The exchange noted that it would continue supporting USDC trades. Moreover, it will continue supporting USDC minted on other blockchains.

“Deposits of USDC tokens via TRC20 will no longer be credited to users’ accounts after 2024-04-05 02:00 (UTC),” a blog post read.

USDC is the second largest stablecoin after Tether (USDT). The stablecoin is pegged to the value of the US dollar. Circle has always promoted USDC as a transparent and compliant stablecoin, with the decision to cut ties with Tron being part of an effort to preserve its values.

In a blog post published in February, Circle said the move to halt support for Tron stemmed from an “enterprise-wide approach that involved the business organization, compliance, and other functions across our company.”

Tron responded to Circle’s decision saying it did not receive any communication from Circle before the stablecoin issuer made the announcement.

The Ethereum blockchain is currently the leading network for the USDC stablecoin. By the time Circle was announcing to halt of TRC-20-based USDC, the stablecoin had a supply of around $355 million running on the blockchain.

The development comes amid plans by Tron to launch a Bitcoin layer-2 solution supporting a wrapped version of USDT. Launching this solution will link Tron with Bitcoin while enabling access to the massive value of Bitcoin. Sun also plans for this solution to boost the financial viability of Bitcoin.

Stablecoins under Pressure to Remain Compliant

The crypto regulatory framework is changing and stablecoin issuers are being forced to adapt. Stablecoins play a huge role in cryptocurrency trades, and with regulators now shifting their focus on the industry, issuers have to make an effort to boost transparency.

Last year, the founder of the Tron blockchain, Justin Sun, was slapped with a lawsuit from the US Securities and Exchange Commission (SEC). The SEC accused Sun of manipulating trading volumes and trading Tron tokens, which were unregistered securities.

Another report in November last year accused Tron of being the largest network used by terror organizations to make cryptocurrency transfers. As regulatory attention on Tron grows, firms, developers, and crypto projects looking to remain compliant might be forced to make more changes.

Circle is not the only stablecoin issuer looking to be on regulators’ good books. Last week, OKX halted support for Tether (USDT) for European users, saying it needed to remain compliant while upholding the security of the platform. At the time, the exchange said only EUR and USDC trading pairs would be supported on the exchange.


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