CoinShots Logo
Binance USD $BUSD To Spark The Second Great Stablecoin War With $USDT, FTX CEO
After statistics show the coin’s increasing market capitalisation, Sam Bankman-Fried has tipped BUSD to ignite a new stablecoin war with USDT.
Muskaan T.
8:58 25th Oct, 2022

Stablecoins, which are often referred to as the backbone of the industry, may soon experience a “second great stablecoin war” fought by market leader USD Tether (USDT) and fast-rising Binance USD (BUSD).

Sam Bankman-Fried, the CEO of the top centralized cryptocurrency exchange FTX says that the rise of Binance’s stablecoin, BUSD, in the past months indicates a new competition for the market share of rivals in the sector that may ignite a new war.

He noted that the first stablecoin war was fought in 2018 with the five big guns, USD Coin (USDC), USDT, True USD (TUSD), Gemini dollar (GUSD), and USDP stablecoin with USDT and USDC dominating the pack.

Last month, Binance decided to auto-convert TUSD, USDC, and USDP to BUSD, which has caused an upward movement in the market share of BUSD. The stablecoin’s market share has risen over 5% since the announcement, from 10.08% to 15.48%.

Furthermore, the market capitalization of BUSD has risen in the last 30 days by 3.3% to $21.7 billion. It is now only behind market leaders USDT and USDC, with a market cap of $68.4 billion and $43.9 billion, respectively.

Though BUSD still trails, it has grown 30 times more than the two market leaders in two years, from 0.5% to 15.48% of the market share. USDC tripled its share from 10% to 32%. Tether, on the other hand, has seen a significant drop from 88% to 48%.

Binance’s Policy Is The Motive For The War

Leading digital asset exchange, Binance announced a stop on a list of trading pairs for TUSD, USDP, and USDC from Sept 29, with users’ assets automatically converted to BUSD. Binance justified the move by explaining that it was done to give users more liquidity.

Bank-Friedman explained that converting USDC and other stablecoins to BUSD “creates a change in supply thus beginning the second stablecoin war.” Binance is the largest centralized cryptocurrency exchange with a daily trade volume of over $10 billion, and this gives its stablecoin BUSD an edge with the auto-conversion move.


CoinShots Logo



Get in touch:

© 2024 Coinshots (AtlasZero LLC). All rights reserved.