Binance will convert USDC, TUSD and USDP balances into BUSD
Cryptocurrency exchange Binance suddenly announced the latest move to further "promote" the stablecoin they "hold" is BUSD.
In an announcement posted on the evening of September 5, the world's largest cryptocurrency exchange Binance announced that as of 10:00 AM on September 29, 2022 (Vietnam time), the platform will merge. balance of 4 stablecoins BUSD, USDC, USDP and TUSD into a single balance of BUSD.
Specifically, the changes that are about to be applied by Binance are as follows:
- Convert all USDC, USDP and TUSD balances to BUSD as of September 29, 2022, users can self-conversion before that;
- Conversion rate is 1:1 for all stablecoins, accounts with stablecoin balance less than 1 will not be converted;
- During and after the conversion period, users can still deposit and withdraw the above stablecoins as usual, just the balance will always show as BUSD;
- Binance will cancel spot, futures, margin trading pairs and staking, saving, convert, loans, pay and gift card products of stablecoins USDC, USDP and TUSD.
In essence, Binance's latest update for a clear purpose is to further increase the coverage of the stablecoin Binance USD (BUSD), the exchange's branded $1-pegged coin, through “delisting” but not “delisting” other stablecoins other than USDT.
Now, when depositing stablecoins other than Tether (USDT) and BUSD to Binance, all balances will be converted to BUSD. Binance's rival FTX has long done this by converting all stablecoin balances to USD, but since this is the common symbol of the US dollar, it at least represents neutrality from FTX, instead of " blatant shill” like Binance.
Binance claims the reason for merging the stablecoin unit into BUSD is to “improve liquidity and capital efficiency for users,” but it doesn’t sound very convincing.
BUSD is currently the 3rd largest stablecoin by market capitalization in the cryptocurrency industry at 19.4 billion USD, surpassed by the top two coins, USDC ($51.8 billion) and USDT ($67.5 billion). many times further away.
Not only angering USDC with the above delist, Binance may also make their partner Paxos, the unit behind USDP and even BUSD, unhappy with this move.
According to statistics from Nansen at the end of August 2022, more than 95% of the circulating BUSD is in the wallets of the Binance exchange.
In recent years, Binannce has continuously made moves to expand its market share, such as free Bitcoin spot trading indefinitely, free ETH/BUSD pair trading until the end of the month. 9 events The Merge event, and the latest is the merging of stablecoin balances into BUSD.
Even so, according to CEO Evgeny Gaevoy of Wintermute, a well-known market maker in the crypto industry, the unification of stablecoin markets by Binance does more harm than good, as it will reduce the divide. liquidity between different stablecoin pairs as well as reducing the need to switch between stablecoins when participating in Binance products.
CEO Jeremy Allaire of Circle, the company behind USDC, also agrees with the above statement and thinks that USDC will benefit even more from Binance's decision by increasing the use of existing products. limited to BUSD and USDT only.
Crypto Fox News Summary
Sep 05, 2022