Binance Boss Shifts Attention to Other Stablecoins Days After the Fall of BUSD

Following the crackdown on major stablecoin companies by the government financial regulatory authorities, of which Binance was one of the victims, they have shifted grounds trying to look for an alternative. Recall, this is Binance’s Paxos which is the affiliate company to Binance and is in charge of developing the BUSD: a Binance stablecoin pegged with the US dollar.

The further minting of the BUSD by Paxos was put on hold by SEC, accusing them of flouting some government financial regulations. That development has led the CEO, Changpeng Zhao embark in search of a better alternative. In an investigative report gathered so far, the majority of former BUSD users have shifted to other viable alternatives like the Tether (USDT) and the USDC.

With this, information coming from Binance says that the company is desperately looking for an alternative to the BUSD; a stablecoin pegged to a fiat currency. Unlike what is applicable with the BUSD, the CEO is working towards developing a stablecoin that can be pegged to any other internationally recognized fiat currency aside from the US dollar.

Reason for the Move

It was reported that the SEC believes that the USD is seriously losing its value to the crypto. This development can also be traced to the implication of the Ukrainian-Russian war. This ugly development can also be seen in major European countries where their economic strength has been drastically reduced as a result of some economic sanctions by the Russian government, which acted as a reciprocal move. 

Just this week, news had it that the UK government, through its financial watchdog has commenced the crackdown on major crypto machine operators. Experts analysts believe that both countries (the US and the UK) are acting under intense economic paranoia; they are afraid that crypto may overrun the traditional fiat currency.

With this, industry stakeholders believe that CZ is trying to avoid being caught up in government paranoia by looking for other ways to come up with a stablecoin that works for everyone. Reports also heard that chain activities reveal that cryptocurrency exchanges are planning to take advantage of adopting other stablecoins into their operations.

Binance and the TUSD

The most interesting news coming from Binance says that the company is currently minting the “TrueUSD” stablecoin, otherwise known as TUSD. Reports say that they are doing this in very large quantities. According to an intercepted message by an anonymous ”crypto Whale,” this latest stablecoin by Binance totals  49 million units of TUSD.

Also revealed is the TrueFi (TRU), another crypto said to be connected to the TUSD, which has also gotten massive patronage lately. In recent report gotten after monitoring its performance for some time now revealed that TRU had increased by an astonishing 170% since its adoption, even with its very limited market capitalization of $971M. Today, it was also stated that the TUSD is ranked No. 54 on the list of top cryptocurrencies.

There have been doubts about the sincerity of Binance’s move to mint the TUSD since the news made it out. To prove that this is true, CZ released a statement affirming such claims. He added that Binance is doing everything possible to support and encourage other stablecoins since the BUSD has become obsolete. 

It is worth noting that the TUSD is one of the earlier stablecoins the company (Binance) had introduced with an auto conversion feature. Auto conversions on BUSD only came sometime in Sep. 2022. The reason for adding such features the company said was to ensure liquidity and enhance capital growth for users who have chosen to save all their digital assets in their BUSD accounts. 

Recall, that the NY State Department of Financial Services had ordered Paxos: a Binance affiliate company to stop the minting of the BUSD used as a stablecoin by Binance. It is also on record that Binance has a little over $16B worth of BUSD in circulation, and it is, before its restriction by the authorities the third biggest stablecoin in the world.

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