BUSDīinance USD (BUSD) is Binance’s very own dollar-backed stablecoin that was launched to provide a Binance-native alternative to other leading stablecoins. As a BEP-20 token, USDC is a popular price-stable asset in BSC’s DeFi lending market. USD Coin (USDC) is the fastest-growing fully reserve stablecoin backed 1:1 by US dollar reserves held in regulated financial institutions in the United States. In the form of a pegged BEP-20 token, USDT can be deployed on Binance Smart Chain in a wide range of DeFi protocols. Tether USD (USDT) is the market-leading dollar-backed stablecoin (with over $30 billion in circulation). The three most recognized and widely used stablecoins on Binance Smart Chain are USDT, USDC, and BUSD.
The same principle applies when you want to peg-out from Binance Smart Chain and swap your coins back to ERC-20 tokens, for example. In the example above, we are swapping 1,000 ERC-20 USDT to 1,000 BEP-20 USDT. The cross-chain swap takes just minutes and enables you to convert Ethereum or Tron-based stablecoins to Binance Smart Chain with ease. Using the Binance Bridge, crypto holders can seamlessly convert an ERC-20 USDT token on Ethereum to a BEP-20 USDT token on Binance Smart Chain. Pegged coins are backed 1:1 by reserves of the original token to enable the use of the digital asset on Binance Chain and Binance Smart Chain. Pegged Coins Bring Stablecoins to Binance Smart Chainīinance Smart Chain is a smart contract-enabled parallel blockchain to Binance Chain, which allows for cross-chain swaps from original chains into so-called “pegged coins” on Binance Smart Chain. Then, when the markets recovered, stablecoins received a boost from the booming DeFi market, driven-in part-by the yield-farming craze.Īs an easily accessible store of value, stablecoins have emerged as the most popular digital currency on-ramp into the DeFi markets, with stablecoin lending taking a massive share of the total value locked up in DeFi. Stablecoin issuance shot up in Q1/2020-fuelled by the need for a stable store of value as the global equity and crypto capital markets collapsed at the start of the pandemic. But it wasn’t until early 2020 that stablecoins moved into the limelight in the cryptoasset markets. The total market value of stablecoins rose steadily as new entrants joined the fray. It wasn’t until 2018 that a new wave of dollar-backed stablecoins - such as USDC and PAX - hit the market, providing crypto traders and investors with a broader choice in price-stable digital currencies. Benefiting from its first-mover advantage, the somewhat-controversial stablecoin has managed to maintain the top spot as the most-used stablecoin in the global crypto capital markets. The first-ever stablecoin, Tether USD, was launched in 2014.
The top five leading stablecoins (measured by market capitalization) are Tether USD (USDT), USD Coin (USDC), Dai (DAI), Binance USD (BUSD), and Paxos Standard (PAX). Stablecoins act as a bridge between fiat and digital currency by providing the benefits of open, accessible, borderless cryptocurrency with the stability of sovereign currencies For example, Binance USD (BUSD) is backed 1:1 by US dollars held in a bank account. Price stability is typically achieved with each coin backed by a fiat currency or commodity to achieve parity with the pegged asset. And so they exist to offer a more stable alternative - hence the name. In short: the main goal is to retain price stability. Stablecoins are a type of digital currency that seek to avoid the price volatility associated with cryptocurrencies such as BTC, ETH, and BNB. Read on to learn what stablecoins are, why they’ve become so popular, and which ones you can buy, hold, and trade on Binance Smart Chain (BSC). In less than twelve months, the stablecoin market went from a few billion dollars in market capitalization to a total value of over $30 billion, fuelled by the demand for a stable store of value and as an on-ramp in the burgeoning DeFi markets. Stablecoins on Binance Smart Chain provide a seamless on-ramp to the chain’s fast-growing DeFi ecosystem