Times are tough for stablecoins, which see their activities restricted by regulators, facing increasingly wary investors. This is also the case for Binance’s BUSD: its issuer Paxos is no longer allowed to make it available. Binance has been forced to pivot, and it seems that True USD (USD) is in its favour.
Binance continues to distance itself from the BUSD
The news is not entirely a surprise to those who have been following Changpeng Zhao’s statements in recent weeks. The Binance CEO has started to distance himself from his BUSD stablecoin since the SEC forced Paxos to stop issuing the stablecoin. He explained about a month ago that the BUSD was not really a native Binance project:
“The BUSD is not issued by Binance. We have an agreement to let [Paxos] use our brand, but it’s not something we created. “
While the BUSD was indeed originally issued by Paxos, Binance’s commitment to its stablecoin project should not be underestimated. Although the current environment has forced the largest exchange platform to go the distance, it is still the third most capitalised stablecoin of the moment. CZ’s statement last month to the contrary is therefore to be taken with a grain of salt:
To be honest, the BUSD was never a big undertaking for us when we started. I actually thought the BUSD project might fail. “
Binance seems to be pivoting to the TUSD
But Changpeng Zhao and Binance in general now want to rely on other stablecoins. Binance’s CEO said in February that he wanted to “get as many as possible” on the platform. And it seems that the current favourite is TrustToken’s TUSD.
As early as 16 February, Binance issued 50 million TUSD immediately after the BUSD’s troubles began. And more signs have emerged since. Yesterday, the CEO of Binance announced that zero-fee trading between Bitcoin (BTC) and the BUSD would be suspended in favour of the TUSD:
Important update. Given recent events, we are moving 0 fee BTC trading from BUSD to TUSD.
Let’s spread the liquidity to more pairs.
https://t.co/6SwqjZYSFZ– CZ Binance (@cz_binance) March 15, 2023
Users will therefore be able to enjoy free trading for the BTC/TUSD pair from March 22 onwards.
The TUSD is enjoying a global resurgence of interest
The True USD stablecoin is enjoying renewed interest in any case since the BUSD was halted, and the USDC’s recent setbacks. In the face of a particularly volatile environment for dollar stablecoins, the crypto community as a whole seems to have repatriated some of its liquidity to the TUSD. The capitalization of the latter has indeed soared in recent weeks:
TUSD capitalisation over the last three months
This corresponds to an increase of TUSD in circulation of +115% over the month. Will the TUSD be able to play in the same league as its well-established competitors? That remains to be seen, but having the favour of Binance can be particularly useful in the crypto ecosystem.
