Regulators order Paxos to stop issuing Binance USD (BUSD) stablecoins. This news also had a negative impact on Binance's native token, BNB
Paxos hit by Binance USD
February 13 turned out to be a truly unlucky day for Paxos Trust Company, the stablecoin issuer behind Binance USD (BUSD) and Paxos Dollar (USDP). As a result, the Binance crypto exchange was also hit, with which Paxos was forced to break off relations due to pressure from regulators.
Last week, BeInCrypto reported that the New York City Department of Financial Services was investigating Paxos.. Today, February 13, a new blow was dealt to the company. The US Securities and Exchange Commission (SEC) accused Paxos of violating the investor protection law. According to media reports, the SEC's main claim against the company was related to the release of stablecoins of the Binance crypto exchange – Binance USD, which the regulator considered an unregistered security.
Following this, it became known that against this background, the financial regulator of New York (NYDFS) ordered Paxos to stop issuing new “stable coins” BUSD. You can learn more about the reaction of the crypto market to today's events in a special BeInCrypto article.
Read also: How the Paxos case will affect the Binance crypto exchange and the BUSD stablecoin
Binance Coin has also declined
The results of the technical analysis of the daily chart show that this month Binance Coin may implement a bearish scenario. In addition to the negative macro news, two factors speak in support of it.
First, the price has completed the formation of a five-wave bullish structure. So now she probably started a correction. Long-term wave analysis is still giving unclear signals as the current decline could be part of wave B (black) or wave 2 (red). A correction option (black) will become more likely if the BNB rate falls below the Fibo 0.618 retracement level at $260. Meanwhile, a bullish option will make itself known more loudly if the price bounces above this level.. In any case, a price increase should be expected subsequently.
Secondly, we can see a bearish divergence on the RSI (green line) which usually precedes a price decline.. This thesis is also supported by the RSI drawdown below 50.
Thus, Binance Coin could drop to at least $260. This would mean a 23% drop from the high.. A market break above the $337 high would reverse this bearish outlook and could push BNB to $400.
Source: Trading View
In general, the most likely scenario for Binance Coin is a drop to at least $260, after which a rebound should be expected.. A rise above $337 will neutralize this forecast and aim the bulls at $400.
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