Binance will move users’ stablecoins into its own currency
In a few weeks, holders of stablecoins on Binance will find that their cryptocurrency does not have the same name, or the same price, as it did previously. The exchange has effectively told its users that it will dig its long, thin fingers into each of its wallets, take out old cryptocurrencies, and exchange them for its own branded version of the fixed store.
Binance, the world’s most popular cryptocurrency trading platform, He told his users Late Monday, it will convert all stablecoins from USDC, the world’s second most popular stablecoin – along with smaller stablecoins Pax Dollar and True USD – to its own brand of stablecoin, Binance USD.
The company said the move was intended to “enhance liquidity and capital efficiency for users,” but that although their announcement was heavy on technical details, it was too light on economic logic. The company said that all coins will be converted at a 1:1 ratio by September 29, and will effectively end all spot, forward or margin trading and lending of those stablecoins.
What he seems to be implying is that Binance wants the core stablecoin experts to trade BUSD, and only BUSD, as long as they are on their platform.
Changpeng Zhao, CEO of Binance, attempted to raise users’ concerns with a Twitter post, saying that they were “merging all liquidity into one pair.”
All users will be forced to trade with a “consolidated” BUSD balance, although users will still be able to withdraw their funds 1:1 using any of the aforementioned stablecoins. However, it does not get over the fact that the US dollar stablecoin (traded as USDC) has a market capitalization of over $51 billion, according to CoinMarketCap Data. Binance USD is still at under $20 billion, as of the time of writing. merge Trade such a key piece of the crypto puzzle (or cipher bubbleWhatever you prefer) its special offer can give a big boost over competitors.
Other stablecoins, although less popular, are still part of the entire cryptocurrency ecosystem. The stablecoin is “pegged” to the US dollar, effectively serving as a fiat currency in the cryptocurrency space. Some of the major stablecoins, such as USDC, are backed by physical tangible assets. Binance said BUSD is backed by tangible assets it deals with Paxos.
USDC is issued by Crypto Circle, which said Take Crunch That a significant portion of the move has “already gone through” based on market activity, and that they believe the move presents “potential questions about market behaviour”. Gizmodo did not immediately hear back from Binance when asked if they had any response on whether they were trying to cram the stablecoin market.
White House managers have already mentioned Issuers of stablecoins should be treated like banks, which means that they will have to disclose the assets to which their stablecoins are linked. This could pose a huge problem for the likes of Binance who may then be restricted Short term proprietary trading. Circle, on the other hand, has already said that they are looking for full recognition as a bank already, and they seem to welcome change.
It is interesting to note that this move does not target stablecoin Also, which remains the most popular stablecoin in the market. It was only this past July when the company said it did. full integration With the Tezos network to allow Tether deposit and withdrawal. Tether has already proven to be less reliable, as it used to be They became unrelated of the US dollar. In this case at least, the company can make an argument beyond trying to confine the cryptocurrency market.
In a statement sent to Cointelegraph, Binance said they have no immediate plans to convert Tether (USDT) into their own stablecoin,”but [that] may change. “
Binance itself has struggled to respond to some users’ pleas for help. a Previous report from Gizmodo The number of user complaints lodged with the FTC center on how Binance does not provide technical support over the phone has shown that users are confused and confused when their accounts suddenly limit withdrawals or are otherwise scammed by nefarious accounts claiming to represent Binance. Meanwhile, the leadership in Binance is like Zhao seems to have a feeling that this is a necessary step in the face of the cryptocurrency industry that continues to hurt it. He even seems to think that Winston Churchill – of all the historical rhetoric he can count on – would agree with him.
Of course, all of this points to the fact that when users store their cryptocurrency on the exchange, they are effectively giving up control of their assets. The recent crash of cryptocurrency has led to multiple exchanges to Basically blocking its users of withdrawing their money. Binance Briefly restricted withdrawals on its own platform in June.
Update 09/06/22 at 11:50 am: Updated to include a statement on whether Binance will similarly limit Tether and another statement from CEO Changpeng Zhao.