Coinbase CEO Brian Armstrong’s feedback to a query in regards to the USD Coin (USDC) stablecoin throughout the firm’s second-quarter incomes calls raised some eyebrows.
Whereas commenting available on the market cap of USDC, Armstrong quipped that Binance moved a few of its funds from USDC into one other stablecoin, however regardless of that, the market cap of USDC has held up.
“Binance truly moved a few of their funds from USDC into one other stablecoin. I feel the information we’ve got within the final six or seven weeks, I imagine, that the USDC market cap is up web of that. And in order that’s an essential information level.”
USDC is the popular selection of stablecoin on Coinbase, and the crypto trade is a member of the consortium that owns USDC. Binance crypto trade as soon as additionally held a major quantity of USDC reserves; nonetheless, primarily based on Armstrong’s feedback, it appears the crypto trade has transformed a piece of its holdings to different stablecoins.
Cointelegraph reached out to Coinbase and Binance to verify the information however didn’t obtain a response by publication.
In line with on-chain information, Binance has been redeeming USDC for United States {dollars} not too long ago, with many market observers believing it’s going towards its new stablecoin of selection known as First Digital USD (FDUSD).
CZ + Solar have been exiting $USDT through $USDC to get USD. Tether cannot redeem billions.
New stablecoins emerge. $TUSD denominated volumes went from 0% to 20% in only a few months. #Binance controls 90% of $TUSD provide. That is quite simple.
The cartel is popping. Please advise. https://t.co/T8PLDNfu2n
— Not Tiger International (@NotChaseColeman) August 4, 2023
Nonetheless, this isn’t Binance’s first conversion of USDC to different stablecoins. In September 2022, the crypto trade introduced it might auto-convert all user-held USDC on the platform to Binance USD (BUSD), the Binance-branded stablecoin issued by Paxos Belief Firm. On the time, the trade didn’t reveal whether or not it deliberate to promote or convert its reserves to different stablecoins
Binance has lengthy been on the lookout for new stablecoins after the New York Division of Monetary Companies ordered Paxos to cease issuing the dollar-pegged BUSD stablecoin. Binance later turned to TrueUSD (TUSD) to mitigate its stablecoin wants; nonetheless, TUSD depegged, and its issuance was halted by June 10.
Binance has since turned to a different comparatively unknown stablecoin — FDUSD. The brand new stablecoin issued by a Hong Kong-based firm has gained traction over the previous few weeks after Binance launched a number of buying and selling pairs for the stablecoin, together with zero buying and selling charge presents.
Associated: USD-backed stablecoin pilot mission launched by Pacific island nation of Palau
The rise of FDUSD even garnered consideration from Tether chief expertise officer Paolo Adriono, who famous that Tether (USDT) was pressured down and USDC, its important competitor, was additionally closely redeemed.
Is not it fascinating that USDt is being pressured down (barely, inside 10bps, simply to push market makers to react), and USDc, the principle competitor that you’d count on being gaining from the state of affairs, is redeemed closely nonetheless, whereas all of a sudden a competitor born 2 days…
— Paolo Ardoino (@paoloardoino) August 3, 2023
USDC is the second-largest stablecoin by market share and was as soon as seen because the true competitor to the market chief, USDT. Nonetheless, prior to now yr, USDC’s market cap has shrunk by practically half, falling from $44.5 billion at the beginning of the yr to $26 billion on the time of writing.
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