coindesk.com
The TrueUSD ($TUSD) stablecoin’s market share in bitcoin ($BTC) trading volume on Binance is catching up to Tether’s $USDT following the exchange’s zero fee trading discount, but data shows traders are still reluctant to use $TUSD, according to crypto data firm Kaiko.
Between Binance’s $BTC-$TUSD and $BTC-$USDT trading pairs, $TUSD’s market share rose to 49%, almost equalling Tether's.
“This is a massive increase over just a few weeks,” Clara Medalie, head of research at Kaiko, said.
However, $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, according to Kaiko data. Moreover, larger buy and sell orders are still placed for the $USDT pair, per Kaiko.“This suggests that traders are still reluctant to use $TUSD despite zero fees,” Medalie added.
$TUSD’s rise has come as Binance, the world’s largest crypto exchange by trading volume, picked the token as heir of its preferred Binance USD ($BUSD) stablecoin issued by Paxos Trust.
The exchange restored trading with $TUSD after a six-month pause 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 $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. Last month, the collapse of crypto-friendly Silicon Valley Bank, reserve partner of the second largest stablecoin $USDC, sent shockwaves through the market. In the aftermath, $USDC suffered more than $10 billion in outflows.
Tether’s $USDT and $TUSD have emerged as 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.