Paxos is examined by US authorities: Report

Paxos is examined by US authorities: Report

PAXOS has been trying to get a national trust Charter for some time. There were rumors that the company was denied the above license, which actually refused.

to clarify speculation: Paxos was neither asked to withdraw his application for a national trust bank at the OCC, nor was the foundation refused. Paxos continues to work constructively with the OCC.

- Paxos (@Paxosglobal) 8. February 2023

Nevertheless, it seems that problems for New York could brew problems.

examination initiated

As a crypto company with headquarters in New York, Paxos Trust Co. is regulated by the New York State Department of Financial Services (NYSDFS). The Watchdog provides locally based companies a Bitlicence that is mandatory for companies that want to work in their jurisdiction.

All Stablecoin-related operations must fully comply with the stable coin-related guidelines of the Nysdfs-which were published after the shameful collapse of Terrausd-as well as all other regulatory guidelines. In return, the New York supervisory authority also receives regulatory insights into the business of these companies.

recently, the Nysdfs initiated an investigation of the business of Paxos, although the exact scope of the investigation is unclear according to Bloomberg.

A spokesman for Paxos refused to comment on the examination himself and explained that it was still going. However, they assured that they are in constant contact with the supervisory authorities regardless of ongoing investigations.

"The department is in constant contact with regulated companies to understand weaknesses and risks for consumers and the institutions themselves through the volatility of the cryptom market we experience."

reasoning for investigation

It is worth noting that Paxos, although it may be best known to operate the stable coin from Binance, also has its own stable coin with USD support as well as gold-supported cryptocurrency and a crypto exchange, ITBIT. Therefore, the present study can be completely independent of Busd or even stable coins in general.

as a binance was asked to comment, she again confirmed that Busd is one of the most transparent stable coins that exist and that it is fully supported.

"BUSD is a 1-to-1-supported stablecoin, which is one of the most transparent stable coins there."

Binance also explained that it will continue to monitor the situation in which Paxos has been involved and will clarify the circumstances if necessary.

Nonetheless, both Binance and Paxos have retained silence with regard to the topic of the examination and will probably continue to do so if this is not absolutely necessary.

It is also important to note that an examination does not mean that misconduct has actually occurred. If the probe proves that no nonsense has taken place, it can even be seen as proof of the strict compliance with the rules.

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