Binance’s US Dollar Backed Coin, BUSD, Surpasses $115 Million in Market Cap
Binance stablecoin, BUSD, hit the $100 million market cap on March 10 following exponential growth in the past few months. Stats show that this U.S dollar-backed crypto coin has gained significantly given it was recently at $22 million.
As it stands BUSD is ranked 6th in market cap amongst stablecoins, Tether dominates this space with over $4.5 billion under its portfolio. The BUSD coin has however shown that this might soon change given its 400% monthly growth.
Stablecoins are slowly becoming a darling for risk-averse crypto holders and traders. These digital assets are normally backed by fiat currencies, precious metals or physical assets to eliminate volatility to some extent. Facebook’s proposed cryptocurrency, Libra, is among the stability-oriented digital currencies based on the plan to back it with a basket of assets.
Unlike most cryptocurrencies, stablecoins are proving to be reliable in a highly risky market. The BUSD, for instance, is backed U.S dollars stored in a bank regulated by the FDIC; this has since build investor confidence around the Paxos issued coin. Rich Teo, the co-founder of Paxos, noted that a stable option will grow crypto market participation;
“The spectacular growth of BUSD shows that the market is hungry for an alternative. We're excited about this milestone and proud to partner with Binance to deliver an optimal solution for our global users,”
Notably, Binance exchange also incentives users to hold the BUSD coin through an annual ROI. The exchange offers a 15% interest for BUSD users in their lending program. CZ Binance is optimistic that stablecoins will continue with the uptrend in adoption as long as their utility can be derived;
“We are looking forward to seeing more utility through the power of stable digital assets and serving our part with BUSD, an NYDFS-approved USD-based stablecoin.”