Binance has announced via a press release dated March 25 that it has halted support for USDC on the Tron (TRC20) network.
Binance noted that its latest decision involving the U.S. dollar-pegged stablecoin, USDC, will take effect starting from April 5, 2024, at 2:00 UTC.
Implications Of Binance's Latest Decision
Binance's recent move invariably implies that the trading platform will no longer support deposits and withdrawals involving USDC operations on the Tron network.
However, the exchange assured users that deposits and withdrawals involving USDC through other compatible networks like Ethereum are still functional and accessible to users.
While Binance might assure users that USDC trading across other networks will remain unaffected, there are high possibilities that USDC's availability across several other blockchains and exchanges will undergo more scrutiny, which could cloud USDC's future with uncertainties.
Binance's Recent Move Influenced By Circle
The trading platform noted its latest decision was due to Circle's discontinuation of USDC support via TRC20.
For context, Circle, an issuer of stablecoins like USDC, had earlier communicated its intention to cease support for the USDC stablecoin on the Tron network in February 2024, adding that plans have been made to move customers' USDC to other blockchains until February 2025.
In addition, the stablecoin operator noted that its suspension of support for USDC on the Tron blockchain will be gradual to enable it to ascertain the integrity of the Tron blockchain amid the allegations hovering around it, like manipulating the market to inflate TRX's trading statistics and accusations of selling unregistered products.
What Is Next?
The future actions of Binance regarding its current stance on the Tron network remain uncertain. Industry analysts suggest that the leading exchange might reverse its decision, contingent on the resolution of ongoing legal challenges faced by Tron. The critical factor in this decision is the outcome of the Tron network's engagement with the U.S. Securities and Exchange Commission (SEC).
This situation stems from last year's legal action by the SEC, which filed a lawsuit against the TRX founder and his associated companies. The SEC's allegations centered on claims that the founder, through various channels, distributed unregistered securities in the form of Tron (TRX) and BitTorrent (BTT) tokens.
The TRX founder has been actively involved in the legal battle for nearly a year, seeking a resolution. Despite these efforts, the SEC's stance remains firm, leading to an extended period of legal proceedings.