Binance’s USD stablecoin, BUSD, has surpassed $1 billion in purchase volume, chipping away at a segment in the cryptocurrency market that still dominated by Tether’s TUSD. The token hits this milestone just 260 days after it was originally launched back in September 2019.
Binance has boosted its stablecoin’s dominance by widening its use cases which now include trading in exchanges, crypto wallets, decentralized finance (DeFi) protocols, payment and fiat gateways, etc.
“It’s been nine months since we launched BUSD. We’ve seen tremendous growth in terms of issuance, reach and use cases for this stablecoin. Several observers have pointed out that BUSD has grown its utility due to several factors, including increased traction in several countries such as Brazil, as well as the growing role of stablecoins in simplifying payments worldwide,” said Binance.
While BUSD at launch was traded almost exclusively on the Binance exchange, the token is now supported/listed on nearly 24 exchanges. As for its market cap, Binance said BUSD’s market capitalization has grown rapidly in just nine months. While growth started at less than $20 million in 2019, capitalization of the token that runs on top of the Ethereum blockchain stands currently at $165 million, as per crypto data aggregator Coinmarketcap.
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This figure, which corresponds to the total value of dollars deposited with its issuer, Paxos, hits its peak in April at nearly $203 million, ranked among top 4 stablecoins.
The gains come as Tether conceded its dominance to other alternatives, including other bank-audited stablecoins such as Paxos Standard, the Gemini Dollar and the Circle’s coins USDC, which is also backed by Coinbase and has a more than $1.1 billion market cap.
The changes in stablecoin market’s share were mainly driven by nagging questions around Tether’s major stablecoin, which has been dogged by speculation that it holds insufficient capital to support its over $9.1 billion market cap of USDT.
The lack of a clear audit of reserves in the crypto ecosystem has caused much discussion and controversy, particularly with regards to so-called stablecoins since they effectively act as a custodian for exchanges that are not provided traditional banking services. Tether has never issued a full audit of its reserves, although it faces lots of legal battles and prolonged issues around its parent company and associated exchange with the US regulators.