Paxos disagrees with the U.S. SEC’s view of BUSD as a security and says it will file a lawsuit if necessary

According to news on Monday, stablecoin issuer Paxos acknowledged that it had received a notice from the U.S. Securities and Exchange Commission (SEC) indicating possible enforcement action based on allegations that its Binance USD constituted an unregistered security. BUSD is a stablecoin pegged to the US dollar owned by Binance. But the company said it “categorically disagrees with the SEC staff’s opinion because BUSD is not a security under the federal securities laws.” The company also claims that Paxos is “always backed 1:1 by U.S. dollar-denominated reserves, fully segregated and held in Bankruptcy Remote Account" and said the company was "prepared to litigate aggressively if necessary."