Stablecoins have been a hot topic of debate throughout the last year. This trend was carried on to 2023 as well with the Binance USD coin [BUSD]. The issuer of BUSD, Paxos has been under regulatory scrutiny for minting the stablecoin. Even though the world’s largest exchange, Binance, doesn’t issue the asset, it came under the public’s eye for its association with BUSD.
The CEO of the firm, Changpeng Zhao distanced himself from BUSD amidst the drama. Binance also stated that it will continue to collaborate with other stablecoin partners. For instance, TrueUSD [TUSD] garnered immense gains as well as popularity with this move. Binance has issued a total of $130 million TUSD in the last seven days. This further boosted the market cap of the asset by 15% and pushed it to $1.12 billion.
Currently, TUSD is the fifth largest stablecoin in the market according to CoinGecko.
Formerly known as TrustToken, the cryptocurrency company ArchBlock now offers TUSD, a stablecoin tethered to the dollar. The blockchain data provider ChainLink’s proof-of-reserve monitoring tool shows that its value is entirely supported by fiat assets.
With Binance seeking other stablecoin partners, BUSD is speculated to lag behind. Another reason for this is the regulatory overhaul of the stablecoin.
Will other exchanges join Coinbase in kicking out stablecoin BUSD?
Earlier today, Coinbase announced that would suspend trading of BUSD. Several feared that other exchanges would do the same and oust BUSD. If this trend catches on, BUSD might lose its peg. But, BUSD wasn’t used as much as USD Coin [USDC] on Coinbase. Hence, at the moment it did not mess with its peg.
Nevertheless, Coinbase became a topic of discussion following the delisting of BUSD. The community asked the exchange if it would do the same if the Securities and Exchange Commission [SEC] targeted USDC in the same manner. Others criticized Coinbase for competing with its rival Binance.
The fact that BlackRock, an investment management firm, backed both USDC and Coinbase was highlighted. Many pointed out how the SEC wouldn’t mess with BlackRock. Therefore, they deemed USDC to be a safe bet.
Despite all of this, BUSD clung to its $1 peg. Its market cap, however, witnessed a slight decline from $12 billion to $10 billion.