# Stable Coin Summary: BUSD (Binance Dollar)

**Published by:** [Cloud Base Crypto](https://paragraph.com/@cloudbasecrypto/)
**Published on:** 2022-06-28
**URL:** https://paragraph.com/@cloudbasecrypto/stable-coin-summary-busd-binance-dollar

## Content

Written by: Leah_Par and Joe_KingType of stablecoin: Fiat backed Who is behind the project: Paxos and Binance Background Binance USD is a stablecoin whose market value is tied to the worth of the U.S. Dollar. It means that one BUSD is equivalent to one US dollar held in reserve. So, rather than exiting the market because of its high volatility, this stablecoin allows holders to swap their tokens easily for fiat currencies — which helps to stabilize the rise and fall of prices in the market — without having to leave the blockchain. BUSD was created through a partnership between Binance and Paxos with the aim of providing a safer and more stable route for other cryptocurrencies, via its relationship with the dollar. USDC and UST, just like BUSD, are major stablecoins whose value are also tied to the U.S. Dollar. And unlike these stablecoins, the market value of other stablecoins are either tied to commodities or assets which include gold and stock, in order to maintain price stability. Reserve / peg mechanism It was revealed in a current blog post by Dan Burstein; the general counsel and chief compliance officer of Paxos, that BUSD’s market capitalization is totally backed by cash and cash equivalent reserves, as well as short term U.S. Treasuries, which were at the time expected to mature in four months. https://lh4.googleusercontent.com/HUUADYiuiq6vjXTjWnFQ2EhNLRa2oDHIQsg79Va3m6S6Xq8PiA49b_qcmgObpbMnv2C8qqkWcUx9d4wv7V-_osqSoB39d2tPpiTC7UyDH8b4gQK25u9SE3tNljn7sb3UXaUpkzLhdwI8dMaBiw Pie chart showing BUSD reserves Source: Paxos The Block stated, “BUSD has emerged as the third largest stablecoin in the world, with a market cap now above $12 billion and a user base of about $1.1 million people ‘’. A recent BSC project analysis further revealed, in May, 2022, (as at the time of writing) that the single-day BUSD trading volume reached $10.72 billion on BSC, with a circulating supply of 17.61 Billion in BUSD. Every month, Paxos provides an audited report of BUSD reserves, so every holder can be updated on if BUSD is maintaining its consistency with the U.S. dollar at every point in time. Recent audits by Paxos: https://paxos.com/attestations/ Where Can It Be Used Ever since its debut in 2019, BUSD has not only guaranteed low volatility in the digital market, it has also walked its way to becoming one of the fastest growing currencies in the market. From trading, to payments and borrowing, BUSD is being used on many exchanges, in decentralized utilities and can be used at this time on few blockchains, namely:EthereumBinance Smart ChainBinance ChainWhere Can I Buy BUSD You can always generate BUSD by depositing your USD, with a trifling or no fee, on exchanges likeCoinbaseBinanceConstantBithanceBlockfiAnd the list goes on.Places To Borrow or Lend As a beginner who is looking to participate in the decentralized/centralized finance borrowing, it is mandatory that you keep these in mind:The rates on loans change from time to time. So you should keep an eye on market pairs.If you’re unsure about borrowing from a particular protocol, you can check out their community backing. The audience engaging with their posts on Twitter, for instance, signifies some level of trust.Does the platform have a good reputation with its audit history?Is the loan custodial — characterized by unfixed interest rates and dynamism, or non custodial — characterized by fixed interest rates?With these considerations in mind, you can borrow or lend BUSD on platforms likeBinance 0.80 %Aave 2.9%Celsius 0.1%Constant 6.0%Closing comments BUSD is one of those few highly regulated stablecoins that complies with the most strictly laid regulatory standards in the world. In retrospect, It has contributed to ensuring the safety and security of all stablecoin holders. It’s accessible, universally accepted and can be used for your exchanges.

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