The recent actions of the SEC regarding Paxos have led the world’s most famous crypto exchange to look for an alternative to the BUSD stablecoin.
In mid-February, Paxos stopped issuing BUSD due to claims made by the Securities and Exchange Commission (SEC). The ban on minting new tokens forced Binance to look for a replacement for the disgraced stablecoin. The choice of the exchange managed by Changpeng Zhao fell on True USD, which is positioned by the developers as “the first regulated stablecoin fully backed by the US dollar.”
Binance is serious about TUSD
TrueUSD is not the only stablecoin issued by TrustToken. The platform manages TCAD, TAUD and TKHD stablecoins pegged to the Canadian, Australian and Hong Kong dollars, as well as TBGP pegged to the British pound. Since its launch, TrustToken has emphasized security and stressed the importance of regular independent audits. Thus, TUSD is aimed not only at retail investors and traders, but also at institutions seeking to reduce risk.
The TUSD issuer TrustToken has been partnering with Binance since June 2019, and during that time, the relationship between the two companies has come full circle. In September 2022, the exchange automatically converted True USD to BUSD in order to increase the market share of its stablecoin. Now it is minting more and more new TUSD to fill the need for stablecoins.
Just days after the Paxos announcement, Binance minted $180 million TUSD, according to Lookonchain. For now token included in the top 5 stablecoins by market capitalization and in the future has every chance to take the place of BUSD.
What’s going on with BUSD
Within a month, the market capitalization of BUSD fell by almost 50% and fell below $9 billion for the first time since 2021. The fall is likely to continue further – after all, in just 6 days, the largest US exchange Coinbase will remove the stablecoin from the listing and will end its support on all its platforms – Coinbase Pro, Coinbase Exchange and Coinbase Prime.
Over the past 3 weeks, investors have purchased more than $7 billion worth of tokens from Paxos, according to a report by Nansen, an analytics company. As a result of a drop in user interest, BUSD has lost its place in the top 10 of the ninth largest cryptocurrency by market capitalization, Dogecoin (DOGE).
Source: Cryptocurrency
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