BUSD Supply Has Plummeted To $10 Billion Following The SEC Action

Key Points:

• The market share held by BUSD has similarly decreased, going from almost 20% the previous year to 7.3% now. As investors changed their minds, the flight of capital helped push Tether’s (USDT) market share up to 52%.
• Binance Dollar (BUSD) is seeing a precipitous fall as its supply has decreased by sixty percent since the middle of February.

After numerous negative news related to this stablecoin, investors are exiting the BUSD market and shifting their money into USDT.

Because to the many rumors and speculations surrounding this stablecoin, investors are pulling their money out of the BUSD market and putting it into USDT. Binance USD (BUSD), the third largest stablecoin, is seeing a precipitous collapse as its supply has decreased by sixty percent since the middle of February. Stablecoins formerly had a market valuation of over $16 billion, but it has since shrunk to somewhere around $10 billion. Moreover, the Binance USD share in the market has shrunk to 7.3%, down from around 20% the previous year. As investors changed their minds, the flight of capital helped push Tether’s (USDT) market share up to 52%.

The United States Securities and Exchange Commission is to blame for BUSD’s decision to leave the market (SEC). On February 13, the regulatory body pursued legal action against Paxos, the stablecoin that is issued by Binance. According to an article published by the Financial Times in London on March 1, analysts believe that the outflow might operate as a “drag to Binance’s financial performance.” Ilan Solot, co-head of digital assets at Marex Solutions, stated that “this would undoubtedly affect Binance’s bottom line given BUSD is such an essential element of the company.” In addition, Coinbase has made the announcement that it would remove BUSD from its exchange since the stablecoin “no longer matches our listing criteria.”

Nevertheless, Changpeng Zhao, the CEO of Binance, stated that BUSD trading has never been a “major business” for the company. Also, he mentioned that Binance plans to offer a substantial number of other stablecoins in the future.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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