With US regulators effectively canceling the Binance-branded BUSD stablecoin, the world’s largest cryptocurrency exchange is now looking beyond dollar-based stablecoins – and it has received notable interest from potential partners.
Patrick Hillman, Binance’s chief strategy officer, has said that several private and public entities have expressed interest in collaborating with the exchange on launching another stablecoin, which may not be dollar-based.
“There are very interesting opportunities, especially in Europe and the Middle East,” Hillman Said in an interview with Forbes without providing further details.
The idea of Binance issuing a non-dollar stablecoin is not entirely new. Last week, Changpeng Zhao, CEO of Binance, said in a Twitter Post The company is exploring other issuers and non-USD based stable coins.
However, experts have claimed that such a pivot may prove difficult, and the stablecoin may hardly have a chance of significant adoption.
For example, the largest non-dollar fiat-backed stablecoin is currently Euro Tether (EURT), which has a market capitalization of $220 million. In comparison, Tether (USDT), which is pegged to the dollar, has a market capitalization of over $70 billion.
“It is one of the many reasons it has taken so long for non-USD stablecoins to become prevalent,” said Kevin Zhang, cofounder of DFX Finance, a decentralized finance protocol for non-USD stablecoins:
“Stablecoin issuers are looking for ways to be properly regulated without spending huge amounts of money on lawyers to provide opinions and make a lot of assumptions.”
Zhang, however, noted that the recent hostile attitude by US regulators creates an opportunity for non-USD stablecoins. “Binance being the size they are and the reach they have they will always be a relevant player in the stablecoin space. Securing trading pairs in a few stablecoins creates huge network effects,” he said.
Last week, New York’s Department of Financial Services (DFS) ordered Paxos, a crypto firm that issues Binance’s stablecoin Binance USD (BUSD), to stop mining BUSD. Subsequently, it was learned that the SEC plan to sue Company upon issuing its BUSD. The agency argued that BUSD is considered an unregistered security.
Binance Losing Foot in the US
In addition to the saga around its stablecoin, Binance is facing increasing difficulty in the US on several other fronts as well. Signature Bank, the banking partner of the exchange last month raised transaction minimums for dollar transfers, announcing that it would only process trades by users with USD bank accounts in excess of $100,000.
exchange as well announced That it is temporarily suspending US dollar withdrawals and deposits for international customers earlier this month.
And before that, American officials Sent The summons to US hedge funds and market-making companies dealing with Binance is asking for records of their communications with the exchange.
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