In agreement to a new post on Twitter, Jeremy Allaire, co-founder and CEO of Circle stablecoin issuer USD Coin (USDC), said that Binance’s recent decision to merge dollar stablecoin registries is “a good thing” for USDC. “This move would lead to a gradual shift of net quota from USDT to BUSD and USDC,” Allaire said.
The previous day, Binance announced that it would stop supporting USDC trading and auto-convert deposits after September 29 to a consolidated Binance USD balance comprising other USD-pegged stablecoins.. Users will be able to withdraw individual components of the consolidated balance at their nominal value.
Some users pointed out that it is now possible to deposit and withdraw USDC without problems on Binance. Before the change, it was necessary to first convert USDC into BUSD or USDT and then use it to trade leveraged products. Therefore, the overall liquidity of USDC would increase.
Nevertheless, others noted that the automatic conversion could lead to more swapping of USDC to mint more BUSD. According to Nansen, the USDC that Binance owns has dropped to less than 1 billion from 2.5 billion in July. Meanwhile, the exchange has around 5 billion USDT.
Data from Dune Analytics suggests that USDC is currently the second most popular stablecoin in the world, accounting for 33.5% of transactions in the category. It has been gaining market share for two years. Tether (USDT) is currently the most used stablecoin, with a market share of 50.3%. For its part, Binance USD ranks third with 15.1%.
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