Paxos Don Settle $48.5M Wit NYDFS Over BUSD AML Failures
Paxos don agree to pay $48.5 million settlement to New York Department of Financial Services (NYDFS) because dem no manage BUSD well well, di stablecoin wey dem produce with Binance. Di deal include $26.5 million fine plus $22 million wey dem go put for Paxos AML compliance program. NYDFS check find say from 2017 reach 2022, geofencing no too strong, sanctions no dey tight plus KYC no proper, make about $1.6 billion illegal transaction pass through BUSD. Paxos no flag suspicious activities or raise alarm and dem no get clear way to handle law enforcement request. Paxos stop to issue BUSD early 2023 after NYDFS talk. Dem dey licensed as limited-purpose trust company since 2015 and don change name to company wey dey focus on compliance blockchain infrastructure. Paxos talk say all the old AML wahala don clear, and dem dey still issue other regulated stablecoins like Pax Dollar (USDP) and PayPal USD (PYUSD). Traders suppose know say this settlement fit make compliance better but no go affect current stablecoin markets.
Neutral
For short term, Paxos settlement over BUSD AML wahala no go likely change trading volume or spoil di peg. BUSD still fully reserved and price stable. For long term, di $48.5 million settlement plus better compliance investment fit boost confidence for regulated stablecoins and make market stable. But because Paxos no dey issue BUSD again and di wahala na old one, market reaction now suppose remain low.