The cryptocurrency exchange Binance has announced it will automatically convert users' holdings of three prominent stablecoins—USDC, USDP, and TUSD—into its proprietary BUSD stablecoin.
Binance Replaces USDC and Other Stablecoins with BUSD
In a detailed announcement, Binance revealed it will auto-convert balances of USDC, USDP, and TUSD into BUSD to enhance liquidity and capital efficiency for its users. The conversion will take effect on September 29, 2022, at 03:00 AM (UTC).
"#Binance to Auto-Convert $USDC, $USDP, $TUSD to #BUSD (Binance USD)."
— Binance (@binance)
This move effectively delists USDC, the world’s second-largest stablecoin with a $52 billion market cap, from Binance’s platform.
"BREAKING: #Binance to remove $USDC as a tradable asset beginning September 29, 2022."
— Watcher.Guru (@WatcherGuru)
The decision may impact Circle, USDC’s issuer, and pose a challenge to Coinbase, Binance’s rival, which collaborates with Circle on USDC.
Key Stablecoins Affected
1. USDC (USD Coin)
- Launched in 2018 by Circle and Coinbase.
- Fully backed by US dollar reserves and regulated by ERC-20 smart contracts.
2. USDP (Pax Dollar)
- Developed by Paxos Trust Company (also behind BUSD).
- Ethereum-based stablecoin with transparent reserves.
3. TUSD (TrueUSD)
- Issued by TrustToken, emphasizing transparency and reliability.
- Market cap: ~$1 billion.
How the Auto-Conversion Works
Binance will:
- Convert balances 1:1 into BUSD.
- Delist trading pairs (USDC/BUSD, USDC/USDT, etc.) by September 26, 2022.
- Remove pending orders post-conversion.
Users can withdraw converted BUSD or trade it in BUSD-denominated pairs.
Impact on Loans and Futures
- Margin loans for USDC/BUSD, TUSD/USDT, etc., will cease by September 7, 2022.
- Open margin positions will liquidate automatically by September 23, 2022.
- Futures trading involving USDC will also convert to BUSD.
Binance advises users to avoid trading during conversion to prevent losses.
Why Binance Is Pushing BUSD
Amid market volatility (e.g., Terra’s UST collapse), Binance is consolidating around BUSD, its regulated stablecoin:
- $19.5 billion market cap (6th-largest crypto).
- 100% backed by liquid reserves (Paxos-managed).
- Arbitrage mechanisms maintain its 1:1 USD peg.
👉 Discover how BUSD compares to other stablecoins
FAQs
1. Can I opt out of the auto-conversion?
No. All eligible balances will convert to BUSD automatically.
2. Will I lose value during conversion?
No. Conversions are 1:1, preserving value.
3. Can I still trade USDC after September 29?
No. USDC trading pairs will be delisted.
4. How does this affect staked USDC?
Staked assets will also convert; check Binance’s FAQ for updates.
5. Is BUSD safer than USDC?
Both are fully reserved, but BUSD is Binance’s preferred stablecoin.
👉 Learn more about Binance’s stablecoin strategy
Final Thoughts
Binance’s shift to BUSD reflects its strategy to streamline liquidity and reduce reliance on third-party stablecoins. While this benefits Binance’s ecosystem, it raises questions about decentralization and user choice in crypto markets.
For further details, refer to Binance’s official announcement.
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