Stablecoins are cryptocurrencies tied to the value of a fiat currency, such as the U.S. dollar or the Euro, and they allow for more price stability when using cryptocurrencies. Many companies have decided to create stablecoins, and so did the Binance exchange with BUSD.
BUSD is a stablecoin created by Binance and Paxos pegged 1:1 with the USD.
BUSD differs from other stablecoins since it is centered around the Binance exchange and its BNB chain, offering its users many benefits for using the BUSD coin.
The price of BUSD at the time of writing (May 16th, 2022) is $1, with a market cap of $17.7B. It is ranked #9 on the cryptocurrency by market cap list. It also has a 24h trading volume of $5.8B.
It is worth noting that the price of BUSD can go only a few cents up or down due to the peg with USD. This mainly happens when there are significant market fluctuations regarding the USD.
BUSD does not have a cap on how many tokens there are. Since Paxos control it, it works with a simple mechanism. One token is equivalent to $1. You send the amount of dollars to Paxos and get the same amount in tokens.
The process goes the same in reverse. When you want to exchange your BUSD for USD, you send the tokens to Paxos, they get burned, and you get your USD.
BUSD is the third most popular stablecoin in crypto. Without a maximum cap and offering good utility to Binance exchange users, it has become an asset in demand.
The primary way people buy their BUSD is through centralized exchanges because they offer the ability to purchase them with credit\debit cards, which most people prefer.
Although significantly more complicated, the second way is through decentralized exchanges such as Uniswap. Decentralized exchanges usually require users to already have some cryptocurrencies in their wallets to buy other cryptos.
Finally, it can be purchased easily through a broker app such as our Veli App, where you can get your hands on some BUSD in just a few taps on the screen.
BUSD was created in a collaboration between the popular Binance Crypto Exchange and New York-based financial institution Paxos.
BUSD does not possess a roadmap, but new things have recently happened.
Implementing stable currencies as an on-site and offline payment/settlement option for private enterprises is the most recent development on the BUSD scene. For example, some hotels let clients book a stay by scanning a QR code that allows them to pay in BUSD.
BUSD is part of the Binance ecosystem of services and applications, meaning that they share a vast community already created by Binance and its BNB chain and token.
BUSD has partnerships with BitPay, Simplex, Moonpay, Alchemy, and several more high-profile companies. On top of that, it is supported by thirty-six established crypto exchanges and twenty crypto wallets.
BUSD was not included in any legal processes or activities.
As the third-largest stablecoin, BUSD has good network activity. Here are some numbers to help us illustrate that.
BUSD’s main competitors are USDT and USDC.
USDT is the largest stablecoin in the world created by Tether. It’s offering the same utility as BUSD. The main difference is that USDT is in legal trouble because it cannot prove that every token is 100% backed.
USDC is the second-largest stablecoin created by Coinbase and Circle. It also possesses the same utility as BUSD and USDT but without the legal issues that USDT has.
Here are some additional numbers to help illustrate this competition better.
Total number of wallet addresses
Total number of daily active users
Total number of new addresses created daily
Centre Consortium (Circle and Coinbase exchange)
Binance exchange & Paxos
There are obvious risks associated with investing in crypto, just as there are with any other asset class. Because there are so many distinct types of cryptocurrencies, risks may be categorized into two groups: general risks that apply to all cryptocurrencies and coin-specific risks.
We’ve put up a guide that covers general cryptocurrency investing risks and offers tips on how to mitigate them, while risks particular to individual coins are covered in coin guides such as this one.
BUSD is one of the few heavily regulated stablecoins. It is also highly accessible and may be utilized for various trading and investing techniques and payment. It is currently used primarily on the BNB chain, Binance exchange, and the Binance ecosystem. The fast-growing number of users shows us that BUSD is getting more adopted. It is currently the 3rd most significant stablecoin by market cap on the cryptocurrency market, behind USDC and USDT.