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Is A Mega Bull Run Incoming? Whale Transfers Over $780 Million Of Stablecoin To Binance

Data Nerd Data on December 13 shows that over the past 24 hours, the wallet “0xea8” moved 200 million BUSD from Binance, the world’s leading cryptocurrency exchange by client count.

The whale transfer caught the attention of keen crypto users, who also noted that the transfer was soon followed by a deposit of 99.95 million FDUSD, a stablecoin supported by the exchange.

Whale Address Accumulating FUSD Stablecoin On Binance

That the address is shuffling and accumulating large amounts of stablecoins is noteworthy. Data Nerd Data shows that the address has transferred over 781 million FDUSD to Binance in the last four months.

During this period, from around September, the crypto market has been recovering, edging higher on the back of improving fundamental factors.

The accumulation of over $781 million of stablecoin by the wallet controlled by an unknown individual or entity is overly bullish for crypto and Bitcoin prices.

It could suggest that a large institutional investor or group of investors is amassing stablecoins, potentially preparing for a significant market move.

Historically, large movements of stablecoins into centralized exchanges have often preceded major bull runs. 

Stablecoins are vital for crypto, ensuring there is enough liquidity. Since most are pegged to the USD and can be backed by fiat, these tokens, mostly minted on Ethereum or Tron, are often used as a gateway to crypto. Therefore, their accumulation can signal increased institutional interest and potential buying pressure.

Is A Mega Bitcoin And Crypto Rally In The Making?

That the wallet address is fortifying its FDUSD base reinforces the notion that institutional investors, ahead of the possible approval of the first batch of Bitcoin ETFs in the United States, could be increasingly warming up and preparing for leading coins like Bitcoin and Ethereum to extend gains in 2024. 

When writing on December 13, Bitcoin and top altcoin prices are relatively stable. To illustrate, Bitcoin is trending higher, stable above the $41,000 level after pulling back from 2023 highs of around $44,000. Crypto participants are bullish and expect Bitcoin prices to float even higher in 2024 before halving.

Bitcoin price trending upward on the daily chart | Source: BTCUSDT on Binance, TradingView

Binance will stop supporting BUSD in 2024. The exchange has also delisted USDC. Accordingly, USDT and FUSD are popular on Binance. However, the exchange continues to be on the Securities and Exchange Commission’s (SEC) crosshairs. 

In late November, the Department of Justice (DOJ) issued a $4.3 billion penalty on Binance as settlement with the SEC, Commodity Futures Trading Commission (CFTC), and other aggrieved agencies in the United States. The deal also saw Changpeng Zhao, the founder of Binance, step down from the CEO role.

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Bye Bye Birdie: Binance Begins Process Of Axing BUSD Stablecoin

Binance crypto exchange announced in late August that it is moving to end support for its beloved BUSD stablecoin. This move comes amid the stablecoin’s run-in with regulators, leading to a halt in its production. And now, the exchange has started moving to begin the end of support for the stablecoin.

Binance Starts Burning Tokens

Binance took to its official X (formerly Twitter) account on Thursday, September 14, to announce that it would begin burning a number of Binance-pegged tokens. Among the five tokens listed to be burned, four were BUSD tokens across different blockchains.

According to the announcement, the Binance-pegged tokens would be burned on the listed blockchains, and then the exchange would release the equivalent amount of tokens that were initially used as collateral on their native networks.

The BUSD tokens listed across four networks include BUSD on the Polygon (MATIC) network, BUSD on the Tron (TRX) network, BUSD on BSC, and BUSD (BNB). In addition to these, the exchange also revealed that the TUSDOLD on BSC would be burned as well, making it the only token on this list that is not BUSD.

The collateral in this case will be the equivalent of the Binance-pegged tokens that are burned. So if 1,000 BUSD on the MATIC network is burned, then the equivalent on the native blockchain will be released by the exchange.

Fire In The BUSD Camp

The BUSD stablecoin first came under fire in early 2023 when the United States Securities and Exchange Commission (SEC) issued a Wells Notice to issuer Paxos alleging that the stablecoin was an unregistered security. The regulator, through this, made its intention to pursue legal action known.

Following the move by the SEC, the New York State Department of Financial Services (NYDFS) asked the issuer to stop printing new tokens. The NYDFS’s concern mainly bordered on Paxos’ relationship with Binance, and eventually, the BUSD issuer decided to cut ties with the crypto exchange.

Since the initial move by regulators, the stablecoin has suffered in terms of usage and market cap. The stablecoin which was once a top 10 crypto by market cap has since seen its market cap decline to $2.5 billion, making it the 26-largest cryptocurrency as of the time of this writing.

Binance has also announced plans to stop offering support for the stablecoin completely by 2024. Paxos also revealed that it will cease all BUSD redemptions in February 2024, and Binance’s complete withdrawal is expected to come shortly after this.

Nevertheless, the stablecoin continues to maintain its dollar peg quite well. It is still trading at a 1:1 parity with the United States dollar and has rarely dipped below $1 amid the regulatory storm.

Binance BUSD market cap chart from Tradingview.com

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FDUSD Market Cap Jumps By 20% Following Binance Directive

The First Digital USD (FDUSD) stablecoin has recorded a significant rise in its market cap following an announcement by the Binance exchange in August. FDUSD, a dollar-pegged stablecoin, was recently launched on June 1, 2023, debuting on the Ethereum network and the BNB Smart Chain. The token was officially listed for specific trading pairs on the crypto exchange in July.

Binance’s Directive Drives Adoption Of FDUSD 

On August 31, Binance confirmed reports of intention to halt support for Binance USD (BUSD) stablecoin following the regulatory embargo on the token’s issuance.

Back in March, The New York Department of Financial Services (NYDFS) had ordered Paxos Trust, the issuing company of BUSD, to cease minting the stablecoin. Since then, BUSD’s market supply has taken a nosedive, crashing by over 80% in the last eight months. 

According to an official post, the exchange will begin the gradual termination of all BUSD products on its platform, urging its 150 million customers to swap their BUSD tokens for other assets before February 2024. 

In particular, the crypto exchange encouraged users to convert their BUSD to FDUSD, touting incentives such as zero trading fees and a 1:1 direct swap ratio. 

According to data from CoinMarketCap, FDUSD’s market cap value has grown by 21.49% from August 31, rising from $324.75 million to its current value of $394.68 million.

This indicates that Binance’s promotion of FDUSD as a BUSD alternative is paying dividends, resulting in a rapid rise in the former’s adoption over the last few days. 

For context, the market cap metric represents the total value of a cryptocurrency based on its market price and the number of circulating tokens. Since FDUSD is a stablecoin with a fixed value of $1, CoinMarketCap’s data means that over 70 million FDUSD tokens entered circulation over the past week. 

In addition, according to the DeFi analytics platform, DeFiLlama, FDUSD now ranks as the ninth largest stablecoin in the crypto market ahead of other popular assets such as Gemini USD (GUSD). 

Binance

Binance Announces New FDUSD Trading Pairs

In other news, Binance unveiled three new FDUSD trading pairs on September 6, maintaining its stablecoin support. 

These trading pairs are DOGE/FDUSD, SOL/FDUSD, and XRP/FDUSD, which will become available for trading on September 7 at exactly 08:00 UTC.

This move comes a week after Binance announced the “gradual” discontinuation of its support for the BUSD token while directing users to convert their BUSD token to other assets. The exchange has begun discontinuing by delisting eight BUSD isolated and cross-margin pairs.

Following these announcements, the BUSD market fall continues, with the token’s market share now valued at an all-time low of $2.73 billion. More data from DeFiLlama shows that the BUSD market cap is down by 4.16% and 12.23% in the last one and seven days, respectively. 

Nevertheless, BUSD remains an important item in the market, ranking as the fifth largest stablecoin in the crypto space.

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Binance To Delist Eight BUSD Trading Pairs Soon, End Full BUSD Support By 2024

The world’s largest exchange, Binance, has announced plans to delist eight Binance USD (BUSD) trading pairs as the company looks to withdraw full support of the stablecoin by 2024. This follows increased regulatory pressure on the stablecoin in 2023, which has led to a drastic decline in its market share so far. 

Binance To Delete Nine Margin Trading Pairs By September 7

In a blog post on Wednesday, Binance laid out intentions to delist eight BUSD cross margin and isolated trading pairs. These include AMB/BUSD, DASH/BUSD, FIDA/BUSD, HARD/BUSD, HOT/BUSD, NULS/BUSD, PORTO/BUSD and REQ/BUSD. In addition, the exchange will also be deleting the IOST/BTC margin trading pair. 

Related Reading: Binance Will Halt These 39 Liquidity Mining Pools This Week

According to Binance, the delisting process will occur in two stages. Firstly, the exchange will suspend all isolated margin borrowing for these specific pairs on September 1, 2023, at 06:00 (UTC).

Thereafter, Binance will close all users’ positions, terminate any pending order, and enable an automatic settlement before proceeding to delist these pairs from its isolated margin market on September 7, 2023, at 06:00 (UTC). On the same day and at the same time, these trading pairs will also be removed from Binance’s cross margin market. 

Binance has stated that users would not be permitted to modify their trading positions during the delisting procedure. Thus, they are advised to close all open positions and transfer their assets from margin wallets to spot wallets prior to September 7 to avoid any possible losses.

In the announcement, the exchange did not state a specific reason for delisting eight BUSD pairs at once. However, emerging reports indicate that this move is part of a much larger plan by the crypto exchange. 

Binance

Binance To Cease Full Support For BUSD In 2024?

According to several posts on the social media platform X, Binance plans to terminate its support for its native BUSD stablecoin by 2024, urging users to convert the token to other crypto assets. This development was revealed via a pop-up notification on the exchange’s mobile app.

Although there was no specific date in the notification, it was stated that Paxos Trust, BUSD’s issuer and operator, will stop BUSD redemption by February 2024. Following this, Binance will gradually withdraw its support for the stablecoin.

As earlier stated, the BUSD token has been affected by the high level of regulatory scrutiny faced by the cryptocurrency industry in 2023. 

Related Reading: Bitcoin Cash (BCH) Records Surprising 15% Rally – What’s Behind It?

In February, the New York Department of Financial Services ordered Paxos to halt the issuance of BUSD, citing “several unresolved issues related to Paxos’ oversight of its relationship with Binance regarding Paxos-issued BUSD.”

Following this directive, BUSD has lost over 80% of its market cap, falling from $16.13 billion on February 9 to its current value of $3.1 billion based on data from Tradingview.