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Top Cryptocurrency Exchange Binance Converts $1,000,000,000 Secured Asset Fund from Bitcoin and BNB to USDC Stablecoin

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The leading global crypto exchange established the “Secure User Asset Fund” (SAFU) in 2018 to protect Binance users from “extreme situations.”

The fund typically tries to maintain a balance of $1 billion, although fluctuating cryptocurrency prices have affected the value of its holdings over the years. At the end of 2022, the fund held $700 million in Binance USD (BUSD) and BNB, in addition to $300 million in Bitcoin (BTC).

However, early last year, BUSD issuer Paxos received a “Wells Notice” from the United States Securities and Exchange Commission (SEC). In the notice, the regulator stated that it was “considering recommending actions alleging that BUSD is a security and that Paxos should have registered the offering of BUSD under federal securities laws.”

The New York Department of Financial Services (NYDFS) also ordered the cryptocurrency company to freeze production of BUSD, which aims to maintain peg to the US dollar, and Paxos subsequently announced that it would end its relationship with Binance to brand the coin. stable.

As a result, Binance swapped SAFU BUSD holdings for the USDT and TrueUSD (TUSD) stablecoins in March 2023.

Now, all of these holdings have been converted into USDC, the second largest stablecoin by market cap. Binance says the move “improves reliability.”

Coinbase and Circle, the leading U.S. cryptocurrency exchange, jointly created USDC in 2018 and jointly managed the asset through the Center Consortium until last year.

In August, Coinbase CEO Brian Armstrong and Circle CEO Jeremy Allaire said that Circle would bring all USDC governance and operations responsibilities in-house.

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