Binance USD (BUSD) market cap has fallen below $10 billion for the first time in nearly two years, amid a US regulatory crackdown on its token issuer and a planned delisting of a major cryptocurrency exchange.
BUSD’s market capitalization has been on a downward trajectory since its all-time high of $23.49 billionwhich reached on November 15, a few days after the resounding fall of FTX.
Since March 3, the stablecoin’s market cap has fallen to $9.66 billion.levels not seen since June 29, 2021.
More recently, BUSD has been the subject of a possible lawsuit against Paxos by the US Securities and Exchange Commission on February 12 for a possible violation of investor protection laws. Since then, BUSD’s market capitalization has shrunk by $6.65 billion.
The New York Financial Services District also ordered Paxos to stop minting and issuing BUSD on February 12.which has likely contributed to the stablecoin’s falling market cap.
Earlier this week, the cryptocurrency exchange coinbase announced that it would delist BUSD from its exchange on March 13 because the stablecoin “no longer met our listing standards”a Coinbase spokesperson told Cointelegraph.
The cryptocurrency market in general has also seen a drop in its market capitalization; many point to the recent controversy surrounding Silvergate Bank with the late filing of its 10-K annual financial report on March 1.
Following its launch in September 2019, the Binance-branded stablecoin rose rapidly to become the third largest stablecoin, behind Tether (USDT) and USD Coin (USDC)..
The stablecoin is currently in the 10th position in terms of market capitalization among all cryptocurrencies.. The next cryptocurrency on the list is Solana (SOL), with a market capitalization of $7.98 billion.
Interestingly, the CEO of Binance, Changpeng “CZ” Zhao, stated at a Twitter Spaces event on Feb. 14 that he never had a very high opinion of the Binance stablecoin project, adding that he thought it “might fail” when it was first launched..
BUSD market cap dropped -$2.45B (from 16.1B to 13.7B as of now), and most of it has moved to USDT.
USDT marketcap + 2.37B (From 67.8B to 70.1B)
USDC also declined -739M (from 42.3B to 41.5B)
Landscape is shifting.
(Note: BUSD is NOT issued by Binance.) pic.twitter.com/kVrZUYjuOh
— CZ Binance (@cz_binance) February 17, 2023
BUSD market capitalization fell -2.45B (from 16.1B to 13.7B as of now), with most of it moving into USDT.
USDT Market Cap +2.37B (from 67.8B to 770.1B. USDC also decreased -739M (from 42.3B to 41.5B) The landscape is changing. (Note: BUSD is NOT issued by Binance.) pic.twitter.com /kVrZUYjuOh
To offset the drop in demand for BUSD, Binance recently minted almost $50 million worth of TrueUSD (TUSD)as the cryptocurrency exchange looks to diversify its stablecoin holdings.
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