Why Is Binance Converting $1B BUSD?
Share this article
An editor at Coincrop
14 Mar 2023 | 3 min read
n response to the recent downfall of crypto-friendly financial institutions, Binance took action by converting an astounding $1 billion from its industry recovery fund into Bitcoin, Ethereum and BNB.
Changpeng Zhao, CEO of Binance, has declared that their industry recovery fund's remaining $1 billion have been effectively converted to crypto assets like Bitcoin, Ethereum and even the exchange's native token - BNB.
On March 13, early trading hours saw the successful transaction take place according to on-chain data. CZ drew attention to how affordable this was and remarked: “Just imagine trying to move $980 million through a bank before banking hours on Monday”.
In November 2022, in the wake of several crypto companies' downturns, Binance established an industry recovery fund to offer liquidity support for those projects that were still financially sound but struggling due to a lack of funds. According to CZ, this was their way of providing much-needed assistance.
For Binance users, converting BUSD to another currency is now essential due to the fluctuations in stablecoins and banks over recent weeks. As CZ stated on March 13th, this step was necessary for us all moving forward.
The recovery fund was initially in its Binance USD (BUSD). However, recent events have led to the capitulation of several crypto-friendly banks — Silvergate, Silicon Valley Bank, and Signature — and have affected confidence in some stablecoins.
In order to mitigate systemic risk to the financial system, U.S. regulators have seized oversight of crypto-friendly banks. Following this move, President Biden stated that he had instructed Treasury Secretary Janet Yellen to join forces with banking regulatory bodies in resolving issues connected with these firms.
JonathanAn editor at Coincrop
Jonathan is a Coincrop staff writer based in the UK, covering the best rates for cryptocurrency earning and borrowing products. When not at work, he's likely sailing.
CoinLoan combine the best of traditional and novel finance helping you borrow, swap and grow your assets.
Compare over 47,341 CeFi and DeFi products across more than 225 organizations here