Stablecoins make up around 15% of all crypto. With a current global crypto market cap of $948 billion, that’s $142.5 billion. With such a market share for stablecoins, competition is stiff. As a result, Binance favors its own stablecoin, BUSD.
Binance ditched three stablecoins in September 2022. This included the world’s biggest stablecoin by market cap, USDC. So, let’s find out why this happened.
#Binance is removing $USDC, USDP and TUSD denominated pairs from the platform, with deposits/withdrawals to be auto-converted to #BUSD.
How significant is this move?
All 3 stablecoins have relatively little volume compared with #USDT/BUSD. pic.twitter.com/xQgq1BAofB
— Clara Medalie (@Clara_Medalie) September 6, 2022
Why Did Binance Delist USDC?
On September 5, 2022, Binance made an announcement. They will start swapping three stablecoins 1:1 to BUSD. On September 29, they completed this process. These three stablecoins are USDC, Pax Dollar (USDP), and TrueUSD (TUSD). They will stop trading on spot, margin, and future trading for the three mentioned coins.
One thing I like to clarify, though. USDC is the second largest stablecoin by market cap. USDT, or Tether, takes the first spot. So, when Binance announced this move, the crypto world paid attention.
Circle is the company behind USDC. In a rather interesting comment, they didn’t seem to be too fazed by the Binance statement. Their CEO expected even more USDC to flow to Binance.
Sharing some perspective on Binance forced conversion of USDC. Lots of misleading headlines and interpretations. Binance is not ending support for USDC, and change will likely lead to more USDC flowing to Binance. Here’s why. 1/
— Jeremy Allaire (@jerallaire) September 6, 2022
The official reason was to concentrate stablecoin liquidity. The three coins in question didn’t trade that much on Binance. In early September, there were $26 billion in stablecoins on Binance. According to Nansen, $20 billion in BUSD and $5 billion in Tether. You can also argue that Binance wants to push their own stablecoin, BUSD.
#Binance to Auto-Convert $USDC, $USDP, $TUSD to #BUSD (Binance USD).
— Binance (@binance) September 5, 2022
Will Binance Remove USDT?
Currently, there’s no sign that Binance will remove USDT. Tether, or USDT, is the biggest stablecoin in the market by volume. There are too many trading pairs that couple with USDT on Binance. Almost all trading pairs. So, in most cases, if there’s only one trading pair available, it’s most likely with USDT.
Delisting USDT from their exchange is, for that reason, not a good idea. BUSD has the biggest presence on Binance. However, USDT is still the biggest stablecoin around. The picture below shows that clearly. It shows stablecoins by market cap. #1 is USDT and #2 is BUSD.
Source: CoinGecko
How Do You Sell USDC on Binance?
The answer is that you can’t do this any more. As of September 29, Binance swapped all USDC on their exchange 1:1 to BUSD. In other words, you can’t sell USDC on Binance.
However, there’s a way around this. You still can deposit USDC on Binance. So…
- Go to the Fiat & Spot wallet and look for the Yellow “Deposit” button on the top of the page. Click on it.
- Now you can choose a coin, and you want to click on USDC.
- Select the correct network so you don’t lose your coins.
- Deposit USDC from your external wallet.
- Once the transaction goes through, you will find your USDC converted 1:1 to BUSD. See the picture below.
Source: Binance
Now you can trade with your BUSD. Once you like to withdraw your deposited USDC, you start a reverse process.
- In the Fiat & Spot wallet, click “Withdraw.”
- Select the coin you like to withdraw. So, that will be USDC.
- A warning will pop up. It says that for each USDC you withdraw, they will deduct one BUSD from your account.
- Give your destination address.
- Select the correct network.
Conclusion
Binance delisted USDC from its exchange in September 2022. We looked at the reasons why Binance decided to do this. On the other hand, Tether (USDT) seems to be doing just fine on Binance.
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