What is Binance USD (BUSD)?

Binance USD (BUSD) is a stablecoin, which is a type of cryptocurrency designed to maintain a stable value by being pegged to a reserve of assets or fiat currencies. BUSD is specifically issued in partnership between Binance, one of the world’s largest cryptocurrency exchanges, and Paxos, a regulated financial institution.

BUSD is built on the Ethereum blockchain and follows the ERC-20 token standard. It is designed to provide users with a digital representation of the United States dollar (USD) and aims to offer stability and liquidity within the cryptocurrency market.

The value of BUSD is intended to remain relatively stable and equivalent to one United States dollar. The stability is maintained through the reserve backing, where each BUSD in circulation is backed by an equivalent amount of USD held by Paxos in a regulated US bank account.

BUSD can be used within the Binance ecosystem for various purposes, including trading pairs against other cryptocurrencies, as a means of payment, and as a store of value. It offers users the ability to quickly and securely transfer funds in USD equivalent without relying on traditional banking systems.

Resources

White paper

Official website

Binance USD (BUSD) blockchain explorer

The History of Binance USD (BUSD)

September 5, 2019: Binance and Paxos announce their partnership to launch a USD-backed stablecoin called Binance USD (BUSD). The token is designed to be fully collateralized, with each BUSD backed by an equivalent amount of USD held in FDIC-insured bank accounts.

September 12, 2019: The official launch of Binance USD is announced, and trading pairs with BUSD are made available on the Binance platform. Initially, BUSD is built on the Ethereum blockchain following the ERC-20 token standard.

February 5, 2020: Binance announces the launch of BUSD on the Binance Chain, which is Binance’s native blockchain. This expansion provides users with additional options for transacting with BUSD and facilitates faster and more efficient transfers.

April 23, 2020: Paxos attains the status of a regulated trust company and is granted a charter by the New York State Department of Financial Services (NYDFS). This regulatory approval strengthens the credibility and compliance of BUSD.

August 31, 2020: Binance USD surpasses a market capitalization of $100 million, highlighting its growing prominence as a stablecoin in the cryptocurrency market.

Since its launch, BUSD has gained popularity among users looking for a stable digital asset pegged to the value of the United States dollar. It offers traders and investors on the Binance platform a convenient means of accessing a stable store of value and conducting transactions with reduced exposure to volatility.

How Binance USD (BUSD) Works?

Binance USD (BUSD) is a stablecoin designed to maintain a value pegged to the United States dollar (USD) on a 1:1 ratio. It operates through a combination of collateralization and regulatory compliance. Here’s a breakdown of how BUSD works:

1. Collateralization: Each BUSD in circulation is backed by an equivalent amount of USD held in reserve by Paxos Trust Company, a regulated financial institution. The reserve funds are held in FDIC-insured bank accounts, providing transparency and security
2. Issuance and Redemption: Users can acquire BUSD by depositing USD into their account with Binance or through the Binance platform. The equivalent BUSD is issued to the user’s wallet. Conversely, users can redeem their BUSD for USD by withdrawing it from Binance and converting it back to fiat currency.
3. Trust and Transparency: Binance USD operates under the oversight of Paxos, which is a regulated trust company. This regulatory compliance helps to ensure transparency, proper handling of funds, and adherence to regulatory standards.
4. Blockchain Technology: Initially launched on the Ethereum blockchain as an ERC-20 token, BUSD has since expanded to the Binance Chain, which is Binance’s native blockchain. This allows for faster and more efficient transactions within the Binance ecosystem.
5. Use Cases: BUSD serves as a stable digital asset that can be utilized for various purposes within the Binance ecosystem. It can be used for trading pairs with other cryptocurrencies, as a means of payment for goods and services, and as a store of value during volatile market conditions.
6. Auditing: Paxos conducts regular audits to verify the collateralization of BUSD. These audits provide additional assurance that the amount of USD held in reserve matches the number of BUSD tokens in circulation, ensuring the stability and trustworthiness of the stablecoin.

How to buy Binance USD (BUSD) on XT.COM?

Binance USD (BUSD) can be purchased directly from XT.COM by using a debit or credit card. Binance USD (BUSD) can also be traded for other cryptocurrencies on the XT.COM Crypto Exchange. Live Binance USD (BUSD) price is updated in real-time on XT.COM. Buy Binance USD (BUSD) on XT.COM in four simple steps:

1. Create your free XT.COM account
   Sign up or download the XT.COM appand start the sign-up process. Provide your email address, country of residence and secure your account with a strong password.
2. Secure Your Account
   Ensure stronger protection of your account by setting Google 2FA code and anti-phishing code.
3. Choose how you want to buy the Binance USD (BUSD) asset.
   Click on the “Buy Crypto” link on the top left of the XT.COM website navigation, which will show the available options in your country.
4. Buy Binance USD (BUSD)
   Use a variety of payment options to buy Binance USD (BUSD) on XT.COM.