Summary
Due to the regulatory uncertainty of the U.S. Securities and Exchange Commission (SEC), Paxos has stopped minting BUSD, which will eventually lead to a near-zero supply of BUSD in circulation.
With the situation not yet critical enough to demand immediate action from the backend, and in light of the competing products’ approaches to the issue, it is time to propose a standard offboarding plan to take place.
Implementation
The plan will be implemented with the following actions:
- Disable Supply in the BUSD market
- Disable Borrow in the BUSD market
- Increase the Reserve Factor to 100%
Please also note that after the proposal is approved, users will still be able to make repayments and withdrawals in the BUSD marketplace.
Process
If this discussion receives community support and is non-contentious, a proposal can be created by any user who holds more than 200 million JST on the platform. Users can participate in voting. If and only if the number of votes in favor of the plan exceeds the number of negative votes and exceeds 600 million, the proposal can be passed and implemented after two days.
Conclusion
JustLend DAO Community believes that this is the most likely course of action, considering the latest developments with Paxos and the SEC. JustLend DAO users are encouraged to transition to alternative stablecoins, with the plan in place. The plan will be implemented to help users smoothly transition and minimize any potential negative impact.