- Recently, Paxos was instructed to cease minting fresh BUSD by New York state officials.
- All funds will continue to be stored at publicly verifiable locations.
Binance introduced the “Secure Asset Fund for Users” (SAFU) on January 29, 2022; the SAFU is a $1 billion emergency insurance fund designed to protect Binance users in the case of a disaster. The SAFU fund’s initial holdings included BNB, BUSD, and BTC. Binance has replaced BUSD in the fund with two other major stablecoins. Since Paxos was instructed to cease minting fresh BUSD by New York state officials.
While looking for a replacement for BUSD, the Binance exchange settled on TrueUSD (TUSD) and Tether (USDT). This transfer will ensure that SAFU assets continue to protect customers even as the BUSD market value gradually decreases.
Moreover, no action is required on the part of users. And all funds will continue to be stored at publicly verifiable locations, as per the official release. According to the report, Binance occasionally adds to the SAFU fund from its own resources to make sure it is sufficiently financed.
Struggling BUSD Stablecoin
Nevertheless, the dominant cryptocurrency exchange said unequivocally that they will maintain support for the BUSD trading pair.
This is devastating news for Binance and BUSD investors since it demonstrates the widespread mistrust in the stablecoin. Having peaked at $15.5 billion in January 2023, the market valuation of the unstable stablecoin has steadily declined and is now just $8.2 billion.
Moreover, according to the official blog article, Dogecoin (DOGE) is now one of Binance’s verifiable assets. Binance’s improved proof-of-reserves system now supports Dogecoin (DOGE) and 10 other cryptocurrencies, allowing its customers to independently verify their DOGE and other cryptocurrency holdings.
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