- BUSD Reserves have dropped to the lowest levels since December 2021.
- The NYDFS orders Paxos to stop producing Binance’s BUSD stablecoin.
- BUSD users have converted $550M of BUSD into fiat U.S. dollars in the last few days.
In light of current information, the net outflow of BUSD (Binance USD) in the Binance exchange is roughly 2 billion. In addition, the BUSD reserve has dropped to about 12.474 billion, a level that has yet to be seen since December 2021. Despite this, BUSD has been able to keep its PEG status.
Since Binance hosts the vast majority of BUSD, these outflows were concentrated there, forcing the currency’s BUSD holdings to drop to the latest levels.
This report comes in the middle of another speculation stating that the BUSD market cap will decline as users switch to other stablecoins and the exchange moves away from using BUSD as the central trading pair. Notably, since mid-November, BUSD’s capitalization has been falling following the news; it fell by $800M to $15.3B.
It is important to note that Binance CEO Changpeng Zhao said that investors might turn to non-US dollar-backed stablecoins amid regulatory pressure on Binance USD (BUSD).
In the same accord, the New York State Department of Financial Services (NYDFS) ordered Paxos to stop minting BUSD because of outstanding problems with Paxos’ management on February 13. Regarding BUSD, Paxos claims that it has cut off communication with Binance. However, Paxos will continue to service BUSD and manage user redemptions.
Following these announcements, BUSD users have already exchanged $550M worth of BUSD for fiat USD. Furthermore, redeemed supply data reveals that BUSD users have converted the $550M value of BUSD into fiat U.S. dollars in the last few days, according to on-chain data.
Read Also :
Crypto News Land (cryptonewsland.com) , also abbreviated as “CNL”, is an independent media entity — we are not affiliated with any company in the blockchain and cryptocurrency industry. We aim to provide fresh and relevant content that will help build up the crypto space since we believe in its potential to impact the world for the better. All of our news sources are credible and accurate as we know it, although we do not make any warranty as to the validity of their statements as well as their motive behind it. While we make sure to double-check the veracity of information from our sources, we do not make any assurances as to the timeliness and completeness of any information in our website as provided by our sources. Moreover, we disclaim any information on our website as investment or financial advice. We encourage all visitors to do your own research and consult with an expert in the relevant subject before making any investment or trading decision.