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Binance USD (BUSD)
It is a US dollar-denominated stablecoin that is approved by the NY State Department of Financial Services. It was launched in partnership with Binance and Paxos and is a US-regulated coin directly pegged with the USD (1 BUSD = 1 USD).
Why traders use BUSD?
Traders uses it because it is offers them a fast way of funding their trades. They also use it because it is an accepted exchange medium, payment method across cryptocurrency systems, and store of value. Users can always also buy and redeem it at a value of $1, making it stable and secure.
The cryptocurrency is not just backed by the USD but also held in FDIC-insured US banks. It is issued by Paxos, its issuer and custodian at the same time.
Traders also use BUSD because they can easily and directly buy it with their debit card, for instance.
If they want to redeem their BUSD, users can simply send their tokens to PAXOS-controlled address from where the coins will be burned while the corresponding amount of fiat currency will then be transferred from the reserve account of Paxos to the user’s bank account.
BUSD is also a good alternative to fiat currencies because it exists on a public blockchain. It only means that BUSD owners can outsource their banking needs through the Paxos system with the cryptocurrency.
In addition, BUSD is a type of ERC-20 token, allowing for easy integration with smart contracts and Ethereum-based dApps. Traders can also store the cryptocurrency in wallets –
- Exodus
- MetaMask
The cryptocurrency is directly tied with the USD, and not through a complicated system. The stablecoin is also an ideal choice among traders in transacting on Ethereum. It just means that they don’t need to convert their USD into ETH to buy goods on Ethereum marketplaces or in services needing ETH.
Its stable dollar value also makes it easier to control than other volatile cryptocurrencies. Seasoned traders who use Binance to trade their digital coins use BUSD as a collateral to increase their risk level, too. Since launch on the crypto space in September 2019, Binance USD is steadily growing in popularity among investors and traders. It is also gaining support from different companies and is being considered safe. It also offers traders plenty of benefits, including its wide range of uses.
