What happened to BUSD and the price of cryptocurrencies?
The recent news about the blocking of BUSD in the United States has not had a major impact on the price of cryptocurrencies. $BUSD is a stablecoin backed by US dollars, and also one of the most popular options for those looking to invest in cryptocurrencies safely.
The blockade affected Paxos Trust Company -the company in charge of issuing BUSD-, and indirectly the cryptocurrency exchange platform Binance, one of the main exchanges that offer BUSD as an investment option. According to the United States Securities and Exchange Commission (SEC), the measure is due to the fact that they considered that BUSD corresponds to an “unregistered security”.
As a result, the value of BUSD has slightly decreased, and investors are looking for alternatives. Recall that each BUSD token is backed 1:1 with US dollars held in custody by Paxos and that they are equal to the total supply of BUSD. This cryptocurrency aims to provide a more stable alternative for investors looking to avoid volatility in the digital asset market.
Additionally, there are other US dollar-backed stablecoins such as USDC and USDT (Tether) that investors can consider as alternatives to BUSD on Binance. In fact, USDT processed $18.2 trillion in transactions in 2022, ranking ahead of traditional payment processors like Visa and Mastercard.
“ Stablecoins have become in recent years the gateway for the adoption of cryptocurrencies and also act as a refuge from the inflation suffered by the local currencies of different countries in the region, including Argentina (87.8%) , Chile (12.8%) and Colombia”, explained Rafael Meruane, co-founder of CryptoMarket .
Meruane adds that despite the decline in the value of BUSD, the overall cryptocurrency market remains strong. The total value of all cryptocurrencies in circulation has recently surpassed $2 trillion, and the market is expected to continue to grow in the coming months.
In summary, although the blockade of BUSD in the United States has generated uncertainty in the cryptocurrency community, the situation is not as alarming as it seems. Investors still have options and the overall cryptocurrency market remains strong.