BUSD: Binance Arms Up USDC into a Stablecoin to Fight Tether

Binance is arming up BUSD with USDC tokens to take down the largest stablecoin in the market

Experts believe that the Binance USD token (BUSD) is one of the best investments in the crypto market. The Binance USD is represented by one of the top crypto exchanges in the world, the Binance exchange, and is backed by the US dollar. BUSD is a well-known digital asset that enables users to hold real-world value in a digital asset ecosystem without being exposed to the extreme volatility of other cryptocurrencies like Bitcoin and Ethereum. Now, over the years, BUSD has been facing major competition from Tether, which always stays at the top of the stablecoin pyramid. Tether is also one of the top stablecoins that have been posing a tough competition to BUSD, for quite a long time. But keeping in mind the present volatility of the crypto market, Binance is taking a leap to overtake Tether and is using up other stablecoins as arms to defeat the mighty USDT. A couple of days ago, Binance, the largest global crypto exchange by volume announced that the platform is ceasing all access to the three top stablecoins to make up an army with its own BUSD token. Binance claimed that the platform is making the move to improve liquidity and capital efficiency on the exchange. Starting from the last week of September, Binance will start converting users’ USD coins, Pax dollar tokens, and true USD tokens into BUSD. Binance Pay, the exchange’s payments services will soon stop supporting these coins.  

Binance delists top stablecoins, but will this be worth beating Tether?

In addition to turning the world’s top stablecoins into BUSD, the exchange is also ending the trading pairs of several stablecoins against BUSD and USDT, as well as other major cryptocurrencies like Bitcoin and Ethereum. The initiatives taken over by Binance indicate that the exchange wishes to increase the supply of its own stablecoin. This also denotes that Binance aims to increase the market share of BUSD. Meanwhile, since the release of this news, BUSD has made up a 14% share of the entire global stablecoin market. Experts believe that the exchange is suspending spot, future, and margin trading with the targetted coins, shutting down all associated trading pairs. Analysts believe that Binance is attempting a hostile takeover of one of the most stable domains of the crypto market. BUSD has been the third-largest stablecoin for quite a long time and it was bound to become restless. Binance has been trying for quite some time to become an investor favorite since it decided on eliminating trading fees for Bitcoin on this platform, earlier this year, which in turn helped grow the stablecoin’s trading volumes. But the exchange is taking its initiatives a step further by firing up other stablecoins and using them to overtake Tether. Besides, as a part of this initiative, Binance will also have close access to its USDC-denominated savings accounts, and other DeFi staking services and loans.  

Can BUSD take down Tether in the coming months?

Tether might be the largest stablecoin in the market, but it surely isn’t entirely stable. Just a few days ago, when Terra’s stablecoin lost its peg, it took down the entire crypto ecosystem, including all the stablecoins. But almost all stablecoins took a hit, but Tether somehow managed to take on the bullet and passed the market’s stress test, withstanding all volatile conditions and eventually reclaiming the peg. Eventually, USDT gained the confidence of the investment community. In a nutshell, BUSD might definitely take over Tether in the future, but the crypto has to work hard to gain the confidence of the investment community, which seems like a difficult task at this point in time. Only the future will tell in which direction USDC, BUSD, and USDT will head, but currently, Binance is bracing itself for a big stablecoin battle.