Binance has converted all cryptocurrencies in its $1 billion emergency insurance fund into stablecoin USDC.
The world's top cryptocurrency exchange established the Safe Assets Fund for Users (SAFU) in 2018 to protect Binance users from “extreme situations.”
The fund has generally sought to maintain balances worth $1 billion, but fluctuations in cryptocurrency prices have affected the value of its holdings over the years. At the end of 2022, the fund held $700 million worth of Binance USD (BUSD) and BNB, and $300 million worth of Bitcoin (BTC).
But early last year, BUSD issuer Paxos received a “wells notice” from the U.S. Securities and Exchange Commission (SEC). “We are considering recommending a lawsuit alleging that BUSD is a security and that Paxos should have registered the offering of BUSD under federal securities laws,” the regulator said in a notice.
The New York Department of Financial Services (NYDFS) also ordered crypto companies to freeze production of BUSD to maintain its peg to the US dollar, and Paxos subsequently terminated its relationship with Binance regarding the branded stablecoin. Then he announced.
As a result, Binance exchanged its holdings of SAFU BUSD into stablecoins USDT and TrueUSD (TUSD) in March 2023.
All of these holdings have now been converted into USDC, the second largest stablecoin by market capitalization. Binance says the switch will “improve reliability.”
Top US cryptocurrency exchanges Coinbase and Circle co-founded USDC in 2018 and co-managed the assets through Center Consortium until last year.
In August, Coinbase CEO Brian Armstrong and Circle CEO Jeremy Allaire said Circle would bring all governance and operational responsibilities for USDC in-house.
Never miss a beat – Subscribe to get email alerts delivered straight to your inbox
Check price action
follow me twitterFacebook and Telegram
Surf the Daily Hoddle Mix
 
Disclaimer: The opinions expressed on The Daily Hodl do not constitute investment advice. Investors should perform due diligence before making high-risk investments in Bitcoin, cryptocurrencies, or digital assets. Please note that transfers and transactions are made at your own risk and any losses you may incur are your responsibility. The Daily Hodl does not recommend buying or selling any cryptocurrencies or digital assets. The Daily Hodl is also not an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Generated image: Mid Journey
