Binance USD or abbreviated BUSD is a regulated, US dollar indexed, fiat-backed stablecoin. One USD is held in reserve for each BUSD coin. In other words, the BUSD price is indexed to the USD at a one-to-one ratio. Binance USD Coin was created by Paxos and Binance.
What is BUSD? What is BUSD Coin?
BUSD coin is technically a fiat-backed stablecoin and is indexed to USD. An amount of USD equal to the total supply of BUSD is held at US banks that are insured by the FDIC and serve as Paxos’ reserves. When the price of USD rises or falls, the price of BUSD changes accordingly. In fact, this is the most common and traditional model for stablecoins as well.
BUSD holders can convert their tokens to fiat or convert their fiat to BUSD. The owner of the project, Paxos, publishes monthly audit reports for BUSD reserves. Binance USD Coin is designed to have a stable market cap. It allows investors and traders to hold a low-volatility asset on the blockchain without having to exit the crypto world.
How Much is BUSD?
BUSD is one of the stable coins that attracts the attention of investors with its price. Therefore, how much is BUSD? The answer to the question is frequently searched in search engines.
There may be minor deviations in price, but BUSD is indexed to 1 USD. The Turkish Lira equivalent, on the other hand, may change depending on the movement of dollar prices.
BUSD Who?
BUSD is a stablecoin created in partnership with Paxos and Binance. Paxos uses blockchain technology to offer the “Stable Coin as a Service” product to external companies. It has also previously created a gold-indexed stablecoin called Pax Gold (PAXG). The New York State Department of Financial Services legally regulates both BUSD and PAXG tokens.
Which Exchanges Have BUSD?
BUSD differs from other stablecoins on the market for a few key reasons. First of all, BUSD falls within the category of fiat-backed stablecoins. There are also crypto-backed stablecoins that use crypto assets for their reserves. An example of these coins is DAI.
Algorithmic stablecoins with no collateral are also available. These projects try to control the supply of stablecoins with algorithms for token creation and burning. So, which exchanges are BUSD available on?
There are some exchanges where Binance USD can be traded. BUSD can be purchased after creating an account on these exchanges and logging in. The exchanges where BUSD takes place are as follows:
- Binance
- bitget
- bitrue
How to Buy BUSD?
BUSD offers three key features for transactions: accessibility, flexibility and speed. The token can be easily accessed via Paxos or Binance. You can buy BUSD on Binance’s exchange or with fiat currency, or send US dollars to Paxos to issue new BUSD tokens for you.
The token exists on different blockchains: Ethereum and Binance Chain. Coin holders can switch their tokens from one blockchain to another between these blockchains as per their needs. This can be done on the Binance exchange (while withdrawing) or on the Binance Bridge.
BUSD also offers flexibility by allowing crypto users to quickly convert their savings into a stable asset without having to move their savings off the blockchain. Finally, users can quickly send money around the world for a low fee using BUSD.
There are several different ways to get BUSD. Several different buying options are available on the Binance USD official website. One option is to buy BUSD on the secondary market. Binance has simple fiat transit channels as well as many tradable BUSD pairs. While on the exchange, BUSD can be exchanged for another cryptocurrency or fiat coin, or a debit and credit card can be used to purchase BUSD.
Another method is to turn to an AMM and trade another coin or token for BUSD in a liquidity pool. Alternatively, USD can be converted directly to BUSD by going to Paxos’ website. Paxos will take the fiat, add it to its reserves and issue new coins for the investor.
So to list it, the following steps can be followed to buy BUSD Coin:
- BUSD is entered to the stock market that you want to buy.
- Purchases can be made by loading money into the exchange wallet.
- BUSD can be exchanged for another cryptocurrency or stablecoin while on the exchange.
- Purchases can be made by paying with a debit or credit card.
- Any coin/token can be exchanged for BUSD in liquidity pools.
- USD can be converted directly to BUSD coin via Paxos’ website.
Where to Buy BUSD?
BUSD is subject to extensive regulation by one of the most prudent regulators, the New York State Department of Financial Services (NYDFS), providing the highest level of protection for consumers. All reserves are held in 100% cash and cash equivalents; therefore client funds can always be cashed out at a 1 to 1 ratio.
Binance USD can be purchased on the official website or on the secondary market.
BUSD Market Data
BUSD market data provides insight into the trading volume, supply, exchange rate, lowest and highest price of this popular stablecoin. As of June 2021, BUSD was recorded as the second largest stablecoin in the market in terms of market value, and rose to 7th place in terms of popularity. This figure includes BUSD’s ERC-20 tokens and BEP-2 and BEP-20 versions of the coin. Despite gaining popularity, there is still a significant gap between the market values of BUSD and its biggest competitor, Tether.
How Much Is BUSD Supply?
The supply of cryptocurrencies can be increased by mining activities. Mining is an activity to confirm transactions on the blockchains of cryptocurrencies, and as a result of these activities, new cryptocurrencies are mined. The supply of these newly produced cryptocurrencies increases and can affect the market in the same frame.
Since BUSD is a stable coin, its price is tried to be kept constant, so its value must be at the same level as the US dollar.
Currently, there is a circulating supply of 16 billion BUSD coins, with a total supply of 16.4 billion coins. The supply of BUSD is 16.4 billion units.This data may change over time.
How is BUSD Supply Determined?
To understand how the BUSD supply is determined, it is necessary to examine how the BUSD coin works.
The mechanism for maintaining the index of BUSD is quite simple compared to other stablecoin types. Every BUSD can be exchanged for 1 USD in reserve. When you send your BUSD to Paxos, these tokens are burned and fiat money is sent to you. This mechanism keeps supply and reserves fixed at a 1-to-1 ratio.
When the price of BUSD starts to drop below 1 USD for 1 BUSD, arbitrage traders buy large amounts of BUSD. Even a price of 0.98 USD can offer these people an opportunity to make a profit. After purchasing large amounts of BUSD, arbitrageurs can convert BUSD tokens into fiat money via the Paxos platform. The increase in demand for BUSD also naturally raises the price of the token back to 1 USD, bringing back the 1-to-1 index.
