Today we will talk about a joint venture of the popular exchange and the developers of the Paxos Standatr stablecoin , the cryptocurrency BUSD binance. Paxos Standard Token is backed by US dollars and is one of the few digital currencies officially recognized by the New York State Department of Financial Services.
But Binance doesn't need any additional introductions. But why would the exchange issue another cryptocurrency if BNB already existed? To make it easier to understand, let's remember what stablecoins are and why they are needed.
What is BUSD
Cryptocurrencies are volatile, which allows you to earn good money on the exchange rate difference and makes this financial instrument attractive for long-term investments, but makes it difficult to use it for daily payments. After all, you can never accurately predict the rate of Bitcoin or Ethereum tomorrow, and more so in a few months or a year. And what is the point of buying a car for 1 BTC today, if in five years it is possible to buy an entire fleet of cars for one coin. On the other hand, digital currencies can not only rise in price over time, but also decrease in price,
Cryptocurrency owners can reap profits or insure against losses while staying on the blockchain . And you just need to convert your normal crypto into stable digital currencies backed by traditional assets like US dollar or gold. And sometimes the best cryptocurrencies Bitcoin and Ethereum play the role of side assets.
The BUSD stablecoin also provides the freedom to move funds between the blockchain and the traditional financial system. Incidentally, this is not the first stable asset issued by Binance. The exchange is also already trading stablecoins linked to the British pound (BGBP) and digital gold, i.e. backed by Bitcoin (BTCB).
History of Binance USD
A reliable stablecoin that provides user interaction for a crypto platform like Binance should be a must. The BUSD token appeared in the fall of 2019. Dollar reserves of the cryptocurrency are also held in vaults at Paxos Trust Company, a regulated financial institution with offices in New York and Singapore. And unlike the BNB cryptocurrency, the stablecoin is issued according to the ERC-20 standard . BUSD Contract Address : 0x4fabb145d64652a948d72533023f6e7a623c7c53.
Immediately after the token appeared, exchange pairs with BTC, Ripple and BNB were launched on the Binance exchange, and developers began offering new options for adapting and developing cryptocurrencies as part of their decentralized finance projects.
Where to buy and how to get coins
There are three ways to buy the BUSD stablecoin.
- Exchange fiat money on the Binance platform or on the Paxos website. The exchange accepts 70 national currencies for payment, including the Russian ruble and Ukrainian hryvnia. Paxos only accepts US dollars or Pax stablecoins. Both sites require registration and identity verification. You can transfer money from a bank card. Exchange clients can pre-deposit funds into a paper deposit, and then purchase BUSD crypto or use the services of Mercuryo, Simplex or BANXA services. In addition, there is a P2P section on Binance, where payments can be made via QIWI, Sberbank or Tinkoff directly to the counterparty.
- Use the instant transfer service for crypto assets on the Binance exchange or in the Trust Wallet interface. 30 virtual currencies are supported, including BTC, ETH, Doge, Pax, and Usdt. In this case, the exchange does not require KYC, and through Trust Wallet, you can conduct an exchange in complete secrecy.
- Exchange one of the 120 cryptocurrencies on the Binance spot market. Create an account , convert your virtual currencies into a deposit on the exchange and start trading. You will find BUSD in the FIAT column. Leveraged trading is supported, and the order originator (maker) does not pay a trading fee.
In addition to Binance, the digital BUSD token is traded on several other platforms. Among them, it is worth noting Poloniex and P2PB2B. The full list is available on the coingesko monitoring service.
How to use BUSD
The BUSD stablecoin allows traders to save on binance trading fees and earn good money from the fluctuations in the exchange rate of traditional cryptocurrencies. Moreover, for half of the pairs with BUSD , margin trading is supported. A maximum leverage of 10x is available for BSUD/ADA, BUSD/BCH, BUSD/ETH and BUSD/BNB. Choose one of the pairs, buy low and sell high.
And if crit trading isn't your thing, you can earn interest on a landing site. Transfer BUSD coins to a private account and earn even while you sleep. A new automated marketplace service, Binance Liquid Swap, also provides an opportunity to earn money by providing liquidity. You can open and close a deposit at any time. A very advantageous offer is deposits using two assets, for example, BUSD and BTC, the income can range from 36 to 82% per annum, depending on the chosen pair and the strike price.
The BUSD digital currency can be used for payments on dozens of online platforms. The list is available .
BUSD Storage Wallets
Cryptocurrency is money, which means it needs a wallet. And the standard ERC-20 tokens , one of which is the stablecoin BUSD , are stored in any Ethereum crypto wallet. We also recommend the official wallet of the Binance exchange, and if anyone else does not know it is Trust Wallet, but MEW, Metamask or any other application that supports this token standard will also work.
If the currency is not in the list, add it manually. You just need the contract title, name, trading index and decimals. The common value of the decimal parameter is 18, in this case the token is like wei (ether = 10^18 wei). Enter the data in the appropriate fields of the form by adding the tokens, click “Finish” and the BUSD wallet is created. The stablecoin will have the same address as the ETH cryptocurrency. And do not forget that in order to send the BUSD token, you must have some amount of Ether on the wallet balance to pay for the services to process the transaction.
And you can store BUSD on a Binance deposit, but if you are not involved in cryptocurrency trading and do not earn money by providing liquidity, it is better to withdraw the coins to a personal wallet. Large holders are advised to purchase a hardware safe, a device in the form of a flash drive that reliably protects blockchain access keys from hackers.
Interesting facts and advantages of stablecoins
Stable cryptocurrencies are needed to transfer national currencies to the blockchain and protect them from inflation. And digital codes do not wear out, they cannot be forged, and the problem is strictly regulated. The list of stable cryptocurrencies is updated regularly, but there are 5 trusted and secure projects whose digital assets are pegged to the US national currency. The TOP $5 stablecoins include:
- USD Tether (USDT), market capitalization $16,910,120,447;
- US dollar coin (USDC), market capitalization $2,892,975,711;
- Binance USD (BUSD) market capitalization $695,302,695;
- Paxos Standard (PAX), market capitalization $430,510,743;
- Real US Dollar (TUSD), market capitalization $264,300,095.
And let's try to figure out which is better to use USDT or BUSD. Considering the advantages and disadvantages of Paxos Standard and USD Tether, because BUSD Binance is a joint product of the Paxos trading platform of the same name.
Tether cryptocurrency
It is the leader in this market segment, it is easy to exchange it not only on exchanges, but also on online exchanges. However, this is one of the most controversial digital currencies released by the notorious John McAfee, who is also the founder of the blockchain projects Ripple, EOS, IOTA, and Tron.
In the blockchain community, disputes have not subsided for a long time as to whether USDT and the Bitfinex platform, whose leaders are in the management team, are manipulating the price of Bitcoin. Eventually, the CFTC and the US Department of Justice became interested in the issue. Tether has been accused of issuing fiat tokens and other illegal activities. The case has not yet been closed.
Paxos Standard
It is an officially recognized stablecoin with an impeccable reputation. The stagnation in the digital asset market and user bias towards stablecoins have long deterred the company. However, after the release of BUSD, Paxos became a trading partner of the largest trading platform, which significantly increased the turnover of cryptocurrencies for this company. In return, Binance can create new products for its users without the risk of falling into the same Bitfinex trap.
conclusion
Stablecoins allow you to fix your portfolio balance at a certain level, and protect your capital from market fluctuations. In addition, it contributes to the integration of blockchain technology into the traditional financial environment and expands the range of options for using virtual assets without having to cash them.
These crypto projects are more centralized than traditional digital currencies like Bitcoin or Ethereum, but that's their peculiarity. Stable currencies are not only a tool for hedging risk, but also a way to save capital during periods of high volatility. BUSD has every chance to take first place in the niche of a safe crypto-asset and become an integral part of the decentralized economy.
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