Jamal Al-Farouq The landscape for stablecoins has undergone a significant alteration this week, as Binance USD (BUSD), once the fourth-largest stablecoin in the market, descended to the fifth position. This movement is attributed to the coin’s supply falling under 3 billion. Concurrently, TrueUSD (TUSD) saw its supply expand from 2.9 billion to 3.438 billion within a span of three days. These events transpired shortly after Binance announced a stepwise decommissioning plan for BUSD, its dollar-pegged stablecoin.
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BUSD Circulation Declines Under 3 Billion Benchmark
As of September 3, 2023, Etherscan data shows that the circulation of BUSD has reduced to 2.844 billion. This stablecoin, which Paxos issued, has thereby forfeited its rank as the fourth largest dollar-pegged stablecoin. It now holds the fifth position among the top ten stablecoins by market capitalization. This development followed an announcement by Binance, stating a planned incremental phase-out of BUSD, in response to directives from U.S. regulators for Paxos to cease token issuance.
As of the stated date, BUSD’s market capitalization ranks it fifth among leading stablecoin assets.
Simultaneously, both TUSD and First Digital USD (FDUSD) observed a supply growth in the past 72 hours. While nine out of the top ten stablecoins showed a contraction in supply last month, FDUSD’s supply swelled by more than 40%. Despite a 3.8% contraction in TUSD supply during August, it swelled to 3.438 billion between August 31 and September 3, marking an 18.55% increase. Data from Nansen analytics estimate that Binance holds approximately 2.782 billion of TUSD.
Additionally, FDUSD’s supply stood at 327 million on August 31, 2023, and has since increased to 382,548,919 FDUSD, as per Etherscan statistics dated September 3. These figures also reveal that Binance holds nearly 99.44% of the FDUSD supply. The top six wallets, which together hold 84.2% of all circulating BUSD, are predominantly controlled by Binance. The exchange wields substantial influence over all three stablecoins in question—BUSD, TUSD, and FDUSD.
According to current data, the aggregate value of reserves for these three stablecoins, held within the Binance exchange, is approximately $6.664 billion. Nansen analytics further disclose that Binance holds 18.10 billion of the 82.89 billion circulating Tether (USDT), which equates to a 21.83% share. Among these dollar-pegged assets, the total value amounts to $24.764 billion, which is 44.18% of Binance’s entire crypto reserve valued at $56.04 billion.
We invite you to share your views on the decline in BUSD’s supply under the 3 billion mark and the simultaneous increase in TUSD and FDUSD supplies. Please offer your insights on this matter in the comments section below.
Frequently Asked Questions (FAQs) about Stablecoins Market Shift
What is the primary focus of the article?
The article primarily discusses the recent changes in the stablecoin market, focusing on the decline in the supply of Binance USD (BUSD) and the surge in the supply of TrueUSD (TUSD) and First Digital USD (FDUSD).
Why has BUSD fallen to the fifth position among leading stablecoins?
BUSD fell to the fifth position due to a decrease in its supply to below the 3 billion mark. This decline followed an announcement from Binance about a gradual phase-out plan for BUSD, prompted by U.S. regulatory directives to Paxos to cease token issuance.
What significant changes have TUSD and FDUSD experienced?
TUSD’s supply increased from 2.9 billion to 3.438 billion within three days, marking an 18.55% increase. FDUSD’s supply also grew from 327 million to 382,548,919 during the same period. Both stablecoins have thus experienced significant growth in supply.
What is Binance’s role in these stablecoin supplies?
Binance holds a substantial amount of all three stablecoins—BUSD, TUSD, and FDUSD. Specifically, Binance holds approximately 2.782 billion TUSD and nearly 99.44% of FDUSD supply. The top six wallets holding BUSD are also primarily controlled by Binance.
How much of Binance’s total crypto reserve is constituted by these stablecoins?
According to available data, BUSD, TUSD, and FDUSD together constitute approximately $6.664 billion of Binance’s total crypto reserves, which stand at $56.04 billion. This implies that these stablecoins make up 44.18% of Binance’s entire asset balance.
Are there any other stablecoins mentioned in the article?
Yes, the article also mentions Tether (USDT), stating that Binance holds 18.10 billion of the 82.89 billion USDT in circulation, amounting to a 21.83% share.
What is the source of the data cited in the article?
The data is primarily sourced from Etherscan statistics and Nansen analytics, as of September 3, 2023.
What are the implications of these shifts in stablecoin supplies?
While the article does not explicitly delve into the implications, these shifts in stablecoin supplies could have a variety of effects on market dynamics, trading volumes, and potentially regulatory scrutiny.
More about Stablecoins Market Shift
- Etherscan Stablecoin Data
- Nansen Analytics Stablecoin Analysis
- Binance Official Announcement on BUSD Phase-Out
- U.S. Regulatory Directives on Stablecoins
- Market Capitalization Rankings for Stablecoins
- Historical Supply Data for TUSD and FDUSD
- Binance Crypto Reserve Analysis
6 comments
A shift like this in such a short time frame is concerning. Does anyone have any insights into why Binance holds so much of FDUSD? Seems a bit sketchy.
I always thought stablecoins were, well, stable. Never imagined them moving so much in rank. This could really affect trading pairs.
With Binance holding that much of Tether as well, it seems they have a lion’s share in the stablecoin market. Regulatory scrutiny could be a ticking time bomb here.
This is massive news for the stablecoin market. TUSD and FDUSD are clearly the ones to watch. Thx for the detailed analysis!
Wow, didnt see that coming for BUSD. Binance’s phase out plan must’ve hit it hard. What’s goin on with the regulators?
6.664 billion in stablecoins just on Binance? That’s nuts, shows how big they’ve become. But also makes you wonder, too big to fail or ripe for regulation?