According to a recent Bloomberg report, Binance, the world’s largest cryptocurrency exchange by daily trading volume, has admitted to historical concerns with the Binance USD (BUSD) stablecoin. According to statistics produced by blockchain analytics firm ChainArgos and evaluated by Bloomberg, the difference between the stablecoin’s reserves and total supply surpassed $1 billion three times.
A Binance representative described the process of maintaining a steady $1 peg as “challenging,” but highlighted that there have been considerable advancements in the management of the BUSD stablecoin.
They also stated that there was no impact on user redemptions and that this issue had not affected anyone else, despite minor anomalies appearing in the data. Binance CEO Changpeng Zhao slammed the Bloomberg report as “FUD” in a recent tweet, ostensibly emphasizing that BNB remains in fourth place in terms of market capitalization.
The BUSD dispute is an example that emphasizes the significance of competent asset management by stablecoin operators, particularly as some of them pioneer new horizons such as algorithmic stability methods.
The collapse of TerraUSD last May serves as a strong lesson to stablecoin holders to remain alert. It remains to be seen how much distrust this event will instill among consumers, who rely on these issuers to provide some kind of protection in unpredictable crypto markets.
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