TrueUSD Closes in on Tether’s Bitcoin Trading Volume on Binance Despite Skepticism

Key Points:

• TUSD market share almost equals USDT in Binance trading pairs.
• Traders still hesitant to use TUSD despite zero fees.
• Stablecoin market undergoing upheaval with Tether and TUSD emerging as winners.

According to crypto data firm Kaiko, the market share of the TrueUSD (TUSD) stablecoin in Bitcoin (BTC) trading volume on Binance is catching up to Tether’s USDT following the exchange’s zero-fee trading discount.

TUSD’s market share rose to 49%, almost equalling Tether’s between Binance’s BTC-TUSD and BTC-USDT trading pairs. This is a massive increase over just a few weeks, said Clara Medalie, head of research at Kaiko.

However, despite the zero fees, TUSD’s growth could not offset the rapid decline in the BTC-USDT pair’s trading volume after Binance waived its zero fee discount for Tether based on Kaiko data. Additionally, larger buy and sell orders are still placed for the USDT pair, according to Kaiko. This suggests that traders are still hesitant to use TUSD.

The rise of TUSD came as Binance, the world’s largest crypto exchange by trading volume, picked the token as the heir of its preferred Binance USD (BUSD) stablecoin issued by Paxos Trust. After Paxos’ decision to stop issuing BUSD and assigned its zero-fee trading discount to the BTC-TUSD pair and waived the promotion from BUSD and USDT starting on March 22, the exchange restored trading with TUSD after a six-month pause.

The $132 billion stablecoin market is undergoing a major upheaval stemming from a regulatory crackdown and a banking crisis in the U.S. In February, the New York Department of Financial Services (NYFDS), the state’s top financial regulator, forced Paxos to cease minting BUSD, the third largest stablecoin with a $16 billion market cap. The collapse of crypto-friendly Silicon Valley Bank, reserve partner of the second largest stablecoin USDC, sent shockwaves through the market last month. In the aftermath, USDC suffered more than $10 billion in outflows.

Tether’s USDT and TUSD have emerged as the clear winners of the crisis. TUSD has become the crypto market’s fifth largest stablecoin with a $2 billion market cap. USDT’s circulating supply has grown $10 billion in the past months and is closing in on its all-time high.

Stablecoins are a crucial element in the crypto ecosystem, facilitating trading on exchanges and serving as a bridge between government-issued fiat money and digital assets.

TUSD is a dollar-pegged stablecoin issued by crypto firm ArchBlock, previously known as TrustToken. Its value is fully backed by fiat assets, according to blockchain data provider ChainLink’s proof-of-reserve monitoring tool. In 2020, a little-known Asian conglomerate Techteryx acquired TUSD’s intellectual property rights, TrustToken said at the time.

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