Binance Explores Non-USD Based Stablecoins: Very Interesting Opportunities
• Binance is exploring opportunities to launch another stablecoin, beyond the dollar-based ones.
• Private and public entities have shown interest in collaborating with the exchange on launching such a stablecoin.
• However, the lack of regulations might prove to be a roadblock for non-USD based stablecoins to become prevalent.
Binance Exploring Non-USD Based Stablecoins
Binance, the world’s largest cryptocurrency exchange, is now looking beyond dollar-based stablecoins after U.S. regulators effectively canceled its BUSD stablecoin. Patrick Hillmann, Binance’s chief strategy officer, has said that multiple private and public entities have shown interest in collaborating with the exchange on launching another stablecoin, one that might not be dollar-based.
Interest from Potential Partners
According to Hillmann in an interview with Forbes, there are “very interesting opportunities” particularly in Europe and the Middle East for this new venture. The idea of Binance issuing a non-dollar stablecoin is not entirely new; last week CEO Changpeng Zhao posted on Twitter that they were exploring other issuers and non-USD based stablecoins.
Regulations Could Prove Difficult
Experts have claimed that such a pivot could prove to be difficult since the largest non-dollar fiat backed stablecoin (Euro Tether) only has a market cap of $220 million compared to Tether (USDT)’s $70 billion market cap. Kevin Zhang from DFX Finance argued that regulations are one of many reasons it has taken so long for non-USD stablecoins to become prevalent because issuers need to properly get regulated without making numerous assumptions or spending large amounts of money on lawyers for opinions.
Recent Hostile Attitude Creates Opportunity
Zhang did note however that the recent hostile attitude by U.S regulators creates an opportunity for non-USD stablecoins as Binance being the size they are will always remain relevant in this space due to trading pairs created by certain denominations creating huge network effects.
DFS Ordering Paxos to Stop Minting BUSD
Last week New York Department of Financial Services (DFS) ordered Paxos which issues Binance USD (BUSD) to stop minting it due which resulted in SEC plans suing them over unregistered security accusation prompting increasing difficulty for Binance within U.S markets as well as their own issued coin controversy