© Provided by The Financial Express Reportedly, Paxos backs the digital asset exchange itBit Paxos Trust Company, the New York-based stablecoin issuer behind Binance USD (BUSD) and Paxos Dollar (USDP), is reportedly being scrutinised by the New York Department of Financial Services (NYDFS), as reported by Cointelegraph.
"The department is in continuous contact with regulated entities to understand vulnerabilities and risks to consumers and the institutions themselves from crypto market volatility we are experiencing," an NYDFS spokesperson said.
According to Cointelegraph, Paxos created the BUSD after entering into a collaboration with Binance in September, 2019. It is believed that BUSD is the third largest stablecoin, having a market cap worth over $16 billion. Reportedly, USDP is the sixth largest stablecoin with a market cap of around $875 billion, as mentioned by CoinGecko. Paxos also backs the digital asset exchange itBit, which it introduced in 2012. Sources suggest that NYDFS handed Paxos the "BitLicense" in 2015, which legally enables companies to perform digital currency-oriented transactions in New York.
Moreover, Cointelegraph noted that Paxos disproved speculation that the US Office of the Comptroller of the Currency (OCC) may instruct Paxos to withdraw its application due to its full banking charter. Paxos made the claim through its website that its BUSD and USDP token reserves are backed completely in US Dollars and US Treasuries.
(With insights from Cointelegraph)
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