Stablecoin Race: DAI Passes BUSD Amid Binance-SEC Regulatory Row
Source: Zeeshan/ Twitter/
DAI is now the third most popular stable coin, after Tether (USDT) and USDC Coin (USDC).
With about $4.6 billion in circulation, the DAI stablecoin has passed BUSD. This comes as Binance, the biggest cryptocurrency exchange in the world, faces more legal problems.
After the governmental drama that started earlier this year, the value of BUSD on the stock market has gone down to $4.3 billion.
CoinMarketcap says that the number of BUSD in circulation has dropped by more than 70% since the beginning of the year. During the same time period, the amount of DAI in circulation has also gone down, but only by 20%.
BUSD was introduced in 2019 as part of Binance’s ‘Project Venus.’ Even though the cryptocurrency market doesn’t make the stablecoin, it has been going down for a few months.
The US New York Department of Financial Services (NYDFS) told Paxos to stop making the stablecoin at the end of February. This was the first big setback for BUSD.
In March, the Commodities Futures Trading Commission (CFTC) sued the exchange for not having the right license and selling the wrong financial goods to people in the US.
After that, the SEC filed a lawsuit against Binance, which forced it to remove eight BUSD trading pairs from its margin trading site.
Even though BUSD has been able to stay in the top three most popular stablecoins for several months despite a lot of volatility, the recent rise in burn rate has finally pushed its supply below that of DAI.
When you look at the bigger picture, the repeated attacks by regulators on the industry have led to a drop in the whole stablecoin market. This can be seen as a sign that money is leaving the digital asset space, which is a worrying trend.
This week, USDT moved away from its $1 peg, which added to FUD stories. However, Tether’s CTO told users that the company is ready to redeem any amount.
