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After the closure of BUSD minting from Paxos, a surge in TUSD stablecoin was expected. Surprisingly, its market share is declining. Since May, TUSD’s market share on Binance has reduced from almost 30% to 5.6%. This reduction has dropped TUSD’s market share below BUSD for the first time.
Binance Removes BUSD Trading Pairs and Announces Token Efficiency Measures
The major cryptocurrency exchange Binance is gradually eliminating its stablecoin, BUSD. It has officially removed BUSD trading pairs from its site. Binance has announced its plan to destroy some of its unused tokens. This measure is part of the exchange’s ongoing token efficiency efforts. Consequently, TUSD is the most likely contender to replace BUSD as its issuer Paxos is facing regulatory scrutiny. However, TUSD is underperforming as per the latest statistics.
After providing security, tokens are removed from their home networks. Binance routinely launches Binance-pegged tokens (B-tokens) to enable trading for Binance Smart Chain users of diverse blockchain tokens.
However, Binance will only create a B-token if it has all the collateral for the original token. For instance, the exchange must deposit 100 USDC to create 100 billion Binance USD (B-USDC).
BUSD and TUSD have lost value in recent months, transforming the stablecoin market. The value of BUSD has steadily declined after Paxos stopped minting stablecoins.
Despite these advances, stablecoins remain vital in cryptocurrency. Cryptocurrency exchanges allow users to buy and sell digital currencies in a safe atmosphere during market turbulence.
Nic Carter Highlights Stablecoins’ Role in Crypto Market
Nic Carter, creator of cryptocurrency monitoring company CoinMetrics, stressed stablecoins at Token 2049. The person said that stablecoins make just a small percentage of the cryptocurrency industry’s worth, with Bitcoin accounting for approximately half.
However, stablecoins are used differently from other cryptocurrencies. The top five stablecoins—USDT, USDC, DAI, TUSD, and BUSD—drive approximately 70% of on-chain transaction activity. However, Bitcoin, Ethereum, and other layer-1 tokens account for 30% of transaction traffic.
Despite market bearishness, stablecoins have maintained high demand. The USDC will settle interbank transactions starting this month, indicating increased institutional use.