BUSD (BUSD) Price Prediction

Deep Dive

1. Regulatory Uncertainty (Mixed Impact)

Overview: Paxos, BUSD’s issuer, is seeking a federal banking license after settling a $48.5M NYDFS fine in August 2025 for past compliance gaps tied to Binance. Approval could streamline operations, but delays or rejections might reignite concerns about BUSD’s oversight.

What this means: Regulatory clarity under the GENIUS Act could bolster institutional confidence, but lingering scrutiny over Paxos’ historic AML lapses (NYDFS) keeps downside risks alive.

2. Declining Adoption (Bearish Impact)

Overview: BUSD’s market share plummeted from 25% at its 2023 peak to 5% in 2025, driven by Binance phasing out support and traders favoring USDC/DAI (@0xOnlyCalls). Daily volume sits at $1.77M, down 72% from 2023 peaks.

What this means: Reduced liquidity and exchange delistings (e.g., Coinbase in 2023) heighten redemption risks, threatening the peg during mass sell-offs.

3. Reserve Transparency (Bullish Impact)

Overview: Paxos maintains 1:1 USD reserves with monthly audits by Withum. The firm’s $22M compliance upgrade post-settlement aims to reinforce trust.

What this means: Consistent proof-of-reserves and regulatory alignment (Paxos) counterbalance skepticism, but BUSD’s shrinking circulation ($55M market cap vs. $23B peak) limits upside.

Conclusion

BUSD’s stability hinges on Paxos’ regulatory wins and reversing its adoption slide. While audits and resolved fines mitigate collapse risks, competition and low liquidity leave it vulnerable to marginalization. Will Paxos’ federal charter approval by Q4 2025 reignite institutional demand, or will BUSD fade into niche status?