Binance will discontinue borrowing and lending services for its native stablecoin Binance USD (BUSD) on October 25.

The exchange will close all outstanding BUSD loan and collateral positions by the end of the month, according to an announcement made on October 3. Users would be able to borrow and lend using stablecoins like as Tether (USDT), Dai, TrueUSD (TUSD), and USD Coin (USDC) on Binance.

Users can currently lend their BUSD on Binance for an expected annual percentage yield of 3%.

It is understood that Binance will halt all services linked to its BUSD stablecoin until 2024. Previously, on February 13, New York fintech firm Paxos, the issuer of the BUSD stablecoin, said that it will terminate its relationship with Binance owing to the latter's continuing battle with the United States Securities and Exchange Commission.

Paxos stated that redemptions from BUSD to underlying US cash and Treasuries would cease in February 2024, with new BUSD minting temporarily suspended.

BUSD was one of the largest stablecoins prior to the termination notice, with a peak market valuation of $23 billion in November 2022. At the time of publication, it had dropped to $2.23 billion.

BUSD and related services have been phased out in stages. BUSD withdrawals via BNB Chain, Avalanche, Polygon, Tron, and Optimism were suspended last month, while they remained open on the Ethereum network.

BUSD deposits, on the other hand, remain available across all blockchains, with the exchange inviting users to convert their BUSD balances into fiat or other cryptocurrency before the end of next year.

Sources:

https://cointelegraph.com/news/binance-shut-down-busd-stablecoin-lending-october-25

https://www.binance.com/zh-CN/support/announcement/%E5%B8%81%E5%AE%89%E5%80%9F%E5%B8%81-%E6%B4%BB%E6%9C%9F%E5%88%A9%E7%8E%87-%E5%B0%86%E4%BA%8E2023%E5%B9%B410%E6%9C%8825%E6%97%A5%E5%85%B3%E9%97%AD%E6%89%80%E6%9C%89busd%E5%80%9F%E5%B8%81%E5%92%8C%E6%8A%B5%E6%8A%BC%E4%BB%93%E4%BD%8D-1d7b456160b349ecbb389b121996d00b

https://www.binance.com/en/support/announcement/binance-encourages-users-to-convert-busd-to-other-stablecoins-prior-to-february-2024-d392843e81fd4bc3a5f7e219aa01f34d