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Binance announce move to convert stablecoins to BUSD

Exchange platform Binance announce decision to convert stablecoins to BUSD

Image source: Medium

Binance is the world’s largest cryptocurrency exchange by volume, and it has been going through some significant changes in the past year.

Recently, the exchange announced it would be automatically converting deposits of USDC, USDP, and TUSD stablecoins into its native BUSD.

The decision effectively delists three rival stablecoins.

The announcement

Binance’s announcement came on Monday, saying the investment conversion would happen on September 29.

However, they reassured users that they will be able to withdraw money denominated in USDC, USDP, or TUSD when removing money from the platform.

“This will not affect users’ choice of withdrawal: users will be able to withdraw funds in USDC, USDP, and TUSD at a 1:1 ratio to their BUSD denominated account balance,” said a Binance post.

According to the exchange, users will be able to see the converted balance on their accounts within 24 hours.

Meanwhile, the minimum amount for manual conversion is 1 USDC, USDP, or TUSD.

Additionally, accounts that have lower balance will automatically convert to BUSD.

What led to the move

The decision from Binance surprised many as they went after exchange rival Coinbase by undercutting it on price.

It also effectively banishes USDC, the second-largest stablecoin, from one of the most prominent perches in crypto.

The conversion erects an obstacle to overtaking Tether (USDT) as the biggest stablecoin.

USDT’s market value ($68 billion) leads USDC ($52 million) with BUSD trailing behind in third with a market value of $19 billion.

Meanwhile, USDP and TUSD are significantly smaller stablecoins.

Binance also said it would amend the list of stablecoins eligible for auto-conversion.

Reaction to the Binance announcement

When the announcement was made, it was greeted with skepticism online.

Many emphasized how the decision converts rival stablecoins into the exchange’s own.

Twitter user Bloodgood (@bloodgoodBTC) did not hold back, writing:

“Crypto monopoly 101, Binance will remove $USDC as a tradable asset by Sep [sic] 25 to push their $BUSD.”

“They also hired ex Brazilian central Bank President as advisor, because bankster connections matters. For regulations.”

“Binance is deleting competitors like Google did 10 years ago.”

Additional changes

The conversion is not the only major announcement made by Binance as they also included the removal of support for USDC, USDP, and TUSD products.

Other products include spot trading, futures, and margin lending.

Meanwhile, Tether, the largest stablecoin with a market cap of $67 billion, will remain accessible on Binance.

References:

Binance, issuer of third-biggest stablecoin, to stop supporting larger rival USDC

Binance pulling support of USDC, converting several stablecoins to BUSD

Opinions expressed by Coin Week contributors are their own.

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