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Binance Dollar Stablecoin Savings Accounts
The following table lists savings account providers and the APY on BUSD deposits. Information about minimum APY is not available.
Binance Dollar Background
Paxos¹ issues and is the custodian of the Binance Dollar (BUSD), a highly regulated stablecoin backed by the US dollar in a ratio of 1:1. BUSD is bought and redeemed at 1 BUSD for 1 US dollar. No fee is charged to buy or redeem it by Binance and Paxos, although there may be some bank wire and other charges.
BUSD is supported on BEP-2 and ERC-20 blockchains. The stablecoin was created in partnership between Paxos and Binance. It’s backed by a diverse team with vast experience in the crypto industry.
Binance itself was founded by the developer Changpeng Zhao and initially based in China. The founder and CEO of Paxos is Charles Cascarilla.
How Does BUSD Work?
BUSD offers a quick way to finance transactions. It is a store of value, an exchange medium, and a reliable payment method worldwide. Both market players and the issuer can benefit from the blockchains’ consensus mechanisms to implement fully transparent cross-asset, cross-region, or cross-application real time P2P transactions. The stablecoin has become wildly popular thanks to its guaranteed stability.
Ultimately, BUSD can be used as an exchange medium across fiat money and cryptocurrency to build an intuitive and decentralized system for global exchange of assets.
Why Does Binance Dollar Stay at 1$? Market Cap
The Binance dollar is fully backed by fiat money insured by the FDIC. Paxos guarantees a US dollar behind every Binance dollar in reserve. BUSD is approved by the NYDFS and undergoes regular audits by accredited law and accounting firms. BUSD’s market cap is $4.05 billion with 4,023,828,979 BUSD in circulation. There is no data for maximum possible supply, as with most stablecoins.
Making Money With BUSD
Binance introduced a liquidity tool called Launchpool recently, which lets users farm new tokens by holding Binance dollar, BNB, and other cryptos on it. By depositing your coins in the pool, you can earn tokens like Wing and BEL from new projects.
BUSD achieves positive results with high liquidity, loan options, savings on trading fees, futures, and above all deposit interest. There is a table listing providers of BUSD savings deposits that offer the highest interest at the end of this article.
The issuer is attempting to drive massive adoption by studying various use cases, such as some tentative first steps in the realm of DeFi. $2 million of liquidity was added to BUSD on Uniswap, a decentralized exchange protocol. This flowed into the BUSD/USDC and BUSD/USDT pairs.
BUSD was listed on Curve.finance liquidity pool’s stablecoin exchange. A BUSD stablecoin pool was added to Yearn.finance as well.
Stablecoins are normally used as loan assets or collateral assets in DeFi, rendering them key to these transactions. The Binance dollar in particular has some unique advantages to offer DeFi protocols. We list some of these below.
- Over 150,000 users hold BUSD on Binance
- Stability through regulation and regular audits
- Vast network of on-ramp and off-ramp fiat money support
- Use a lot of local currencies to buy and exchange BUSD
- Excellent liquidity with almost 100 trading pairs on Binance
- Option to buy and redeem for USD quickly, including in big amounts
- More stable prices compared to many other analogical tokens
Binance Dollar (BUSD) Regulation
Apart from the NYDFS, there are several other US regulators that approve the Binance dollar, making it one of just three tokens with that status. Binance and Paxos work in partnership to fulfill regulatory requirements for stablecoins. This ensures BUSD will continue to improve the DeFi ecosystem with a seamless global network, enabling digital assets to add speed, flexibility, scalability, and accessibility to transactions.
How can the Stable Value be Guaranteed?
For starters, anyone who’s interested can view BUSD audit reports on the official site. These are published monthly. BUSD wallets ensure legal traceability, protection, and smart security to make sure you can recover your assets as a trader or investor if they are stolen. This contributes to the exchange’s stability and asset security a great deal.
How Long do Binance Dollar Transactions Take?
Normally, Binance generates a transaction ID within 30 minutes to one hour. After this time, the exchange will have recorded the withdrawal transaction successfully. Confirmation of the transaction might still take some time. Then, you’ll need to wait for the wallet to credit the funds. None of this will exceed 24 hours.
How to use the Binance Dollar
You can use BUSD to trade against numerous pairs and save on fees, to support margin trades, earn interest on a savings deposit, and/or make money by lending your tokens. It can be used as a substitute for USD in trading, which is also possible on platforms that don’t require ID verification. You can transfer funds in BUSD on the blockchain and with low cost anywhere in a very short period of time.
Users can trade BUSD on various DeFi exchanges, make payments for goods and services, use the stablecoin as a loan and collateral asset, as cross collateral in futures, or store it in a wallet or on an exchange.
Where to buy Binance Dollar with USD
Of course, you can convert USD to BUSD on the Binance exchange platform. To buy BUSD, you can use ACH transfer, debit card, or your cash balance on Binance.US (Binance’s dedicated platform for US traders). Numerous ways to trade BUSD for cryptos are supported on Binance.US and on Binance’s international platform.
How to buy Binance Dollar With Credit Card
On the homepage of Binance.us, choose “Buy with cash”, then “Credit/Debit Card”. To see what fiat is available, click on “USD”. Choose your local fiat currency from the list or enter a currency of choice in the search bar. Click on BUSD after entering a fiat amount you want to spend.
Choose a card or click on “Add a new card”, then press “Buy”. After checking the amount, press “Confirm” at the bottom of the page.
Trading BUSD for BTC and Stablecoins
Naturally, one platform you can do this on is Binance. The conversion rate of USDT, PAX, USDC, and TUSD to BUSD is always 1:1. The exchange supports a large number of trading pairs to exchange other coins to BUSD with zero fees. There is also a number of cryptocurrencies you can convert to Binance dollar apart from BTC, including ETH and LTC, and DeFi tokens like UNI. DOT and DOGE are two community-driven coins available for trade. The limits range from $10 to $4 million per order.
BUSD wallets are open on Poloniex³. Users can make deposits in BUSD or BNB and trade the following pairs: BNB/BUSD, BUSD/USDT, and BTC/BUSD. On April 5, 2021, 1 BTC went for 57,921.36 BUSD.
Other exchanges where to trade BUSD are Uniswap, Curve, 1inch, Kyber, Loopring, Tokenlon, Mooniswap, Paraswap, and Bepswap. You can earn from DeFi products or join liquidity mining on Yearn, Delphi, Aave, Curve, Cream, Fortube, 1inch, and Bepswap. Finally, you can borrow or lend BUSD on Aave, Cream, and Fortube.
BUSD can be transferred easily from one platform to another, a far cry from cumbersome and often costly wire transfers. You can use it to cash out cryptocurrency instantly without the need of fiat money bank transfers. BUSD enables fast and borderless money transfers. It’s possible to run a business on this stablecoin and save a lot of money.
How to Convert Binance Dollar to Bitcoin
You can do this on numerous exchanges, including Binance, HitBTC, Naijacrypto, and Pionex. The exchange rates are 0.00001696 BTC, 0.00001731 BTC, 0.00001696 BTC, and 0.00001696 BTC for 1 BUSD respectively. Another 17 exchanges are available for viewing on coincodex.com². Do compare the rates before choosing one.
How to Cash out Binance Dollar?
On Binance’s Buy and Sell page, you can exchange it for Bitcoin and then Bitcoin for fiat and withdraw it from your account. This is just one of the many ways to cash out. The question is whether you should. Stablecoins are a reliable store of value. What’s more, you can make payments in them, as mentioned, which will ultimately cost you less than converting them to fiat money. It’s also far less of a hassle.
The Binance Card is one way to pay for transactions and bills using crypto. The card is available in many European countries and Binance is adding more and more countries. It’s a good alternative to cashing out.
Neither Binance nor Paxos will charge fees to redeem BUSD. Your crypto wallet issuer and/or financial institution may have some charges related to the transfer of funds.
Conclusion: BUSD Pros and Cons
Binance Dollar shares the pluses and minuses of all fiat collateralized stablecoins. Volatility is minimized thanks to the 1:1 stability mechanism. The blockchain holds no collateral, making BUSD less vulnerable to hacks. BUSD is easy to understand and bridges the gap between fiat currency and cryptocurrencies. Finally, it’s scalable. The system can be developed to sustain a big ecosystem.
BUSD also has some downsides. Its critics claim it’s too regulated, bound to governments and central banks and susceptible to undesirable intervention by authorities. Its issuance and operation can be centralized. Finally, the issuer might decide to stop maintaining the buy wall.