Paxos Trust Company, the issuer of Binance USD stablecoin, plans to “vigorously litigate” against the U.S. Securities and Exchange Commission’s (SEC) Wells notice.

The SEC alleges that BUSD breached investor protection laws and should have been registered with the agency as a security.

Paxos has denied the allegations, stating that the stablecoin is always backed 1:1 with USD reserves and is not a security under federal securities laws.

The Wells notice applies only to BUSD, and Paxos is prepared to engage with the SEC on the matter. The New York Department of Financial Services has ordered the firm to stop issuing new BUSD.