Looking at the recent developments around Binance USD, the stablecoin has liquidated a market cap of around $2.5 billion. Money has simply shifted from Tether to Tether, said Changpeng Zhao, co-founder and CEO of the world’s largest cryptocurrency exchange by trading volume, on Friday. Zhao also reiterated that Binance USD is not issued by Binance.
changpeng zhao “BUSD market cap fell by -$2.45B (from 16.1B so far to 13.7B), and most of it moved to USDT,” tweeted one known as CZ.
According to him, the market cap of USDT which is Tether has increased by $2.37 billion to $70.1 billion from the previous $67.8 billion.
Furthermore, Zhao pointed out that USD Coin as well saw a decline in market cap from $739 million to $41.5 billion from the earlier $42.3 billion.
“The landscape is changing”, he said, reiterating that “BSD is not issued by binance,
Why is money leaving the Binance USD stablecoin?
The reason for the drop in the market cap of Binance’s stablecoin will be regulatory scrutiny.
Earlier this week, the New York Department of Financial Services on Monday ordered Paxos Trust Company, the creator of Binance USD, to stop mining the BUSD token over a number of unresolved issues related to Paxos’ oversight of its relationship with Binance. For.
DFS said it is closely monitoring Paxos to verify that the company can facilitate redemptions in an orderly manner subject to advanced, risk-based, compliance protocols.
According to DFS, the department authorized Paxos to issue BUSD on the Ethereum blockchain. While the Department has not authorized Binance-Peg BUSD on any blockchain, and Binance-Peg BUSD has not been issued by Paxos.
As required by DFS, all stable coins issued by DFS-regulated entities are required to be fully 1:1 backed by cash or cash equivalents.
Later, on February 13, Paxos announced that it would be ending its relationship with Binance for its branded stablecoin BUSD.
On February 14, on the occasion of Valentine’s Day, Zhao answered questions from users, specifically centered around stablecoins and Bus.
In a Binance blog, Zhao said, Binance has not issued BUSD. It has the Binance brand, but it’s not something we created or operated. Binance is a platform designed to help people access a wide range of digital assets, including stablecoins.
“We will continue to work with multiple stablecoin issuers,” Zhao said.
When asked if BUSD is safe, Zhao said, if you look at the NYDFS notice posted on their website, they specifically told Paxos to ensure 1:1 pegging and redeeming customers in an orderly manner. Directs to ensure the capacity of
Therefore, the billionaire said, “even if the mining of new BUSD stops, the existing circulating supply is safe,” adding that “there should be no loss for any user.”
current performance:
On CoinMarketCap, Binance USD (BUSD) is trading broadly flat below the $1 peg. At the time of writing, its market cap is around $13.71 billion. While USD Coin (USDC) is also trading at its stable level with a market cap of $41.67 billion.
Similar was the case with Tether, which held on to its peg with a market cap of $70.17 billion.
However, the Binance coin BNB is down around 4% and is below the $310 level. Its market cap is around $ 48.92 billion.
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