Binance has announced that on September 23, all concerned USDC products will be terminated. According to CoinGecko, the United States Dollar Coin produced by the American company Circle, is the world’s second-largest stablecoin. It has a market capitalization of $51.8 billion. The value of the stablecoin offered by Binance, known as BUSD, is around $19.4 billion.
Binance announced on Monday that it would automatically convert user balances of the stablecoins USD Coin, Pax Dollar, and True USD into BUSD. In spite of the fact that users will still be able to make deposits and withdrawals using those stablecoins, the announcement made by Binance raises questions about the company’s competitive motivations while also sparking misinformation about what the move means for USDC.
According to a statement released by Binance, the change is being made with the goal of improving customers’ access to liquidity and capital efficiency.
Stablecoins play an essential part in the facilitation of cryptocurrency trading and let traders retain unused cryptocurrency funds without changing them back into fiat money.
As a direct consequence of this action, the most significant cryptocurrency exchange in the world has announced that it will discontinue spot, future, and margin trading with USDC, USDP, and TUSD pairings.
‘While optimizing dollar liquidity on the world’s largest exchange may carry benefits, the paradigm does raise potential market conduct questions,’
a spokesperson for Circle said in emailed comments, without elaborating on what questions were raised.
The Chief Executive Officer of Circle, Jeremy Allaire, said in a tweet that a beneficial development is the convergence of dollar books on Binance. The usefulness of USDC has simply risen.
In a separate tweet, Allaire said that he believed the move would result in USD Coin and Binance USD gaining market share at the expense of Tether, which is now the most widely used stablecoin.
