There Is A Lot Of Potential For Non-Dollar Stablecoins

There Is A Lot Of Potential For Non-Dollar Stablecoins

After U.S. regulators thwarted Binance is plans for a BUSD stablecoins, the world’s largest crypto exchange has shifted its focus to non-dollar options – attracting much attention from potential partners along the way.

Binance Points to Increasing Interest in Non-Dollar-Based Stablecoins

In an interview with Forbes, Patrick Hillmann, Binance’s Chief Strategy Officer, revealed that numerous private and public entities have shown interest in partnering up with the exchange to launch a non-dollar stablecoin. He further added, “There are exciting opportunities, particularly in Europe and the Middle East,” without providing any more information. This idea of introducing another form of stablecoin by Binance is not entirely new. Last week, CEO Changpeng Zhao gave hints about exploring other issuers for the possible introduction of such kind through his Twitter post.

Although specialists have contended that such a transition might prove to be tricky, the stablecoin may find it hard to gain considerable traction. For example, Euro Tether (EURT), which is currently the largest non-dollar fiat-backed stablecoin with a $220 million market capitalization, cannot rival its dollar-pegged counterpart – Tether (USDT) – whose market cap surpasses an outrageous $70 billion.

Kevin Zhang, cofounder of DFX Finance — a decentralized finance protocol for non-U.S. Dollar stablecoins — explains that regulatory considerations have delayed the widespread use of non-USD stablecoins: “Stablecoin issuers are seeking clearance from regulators to avoid unwarranted assumptions and costly legal fees.”

Zhang also pointed out that U.S. regulators’ current aggressive stance presents a possibility for non-dollar stablecoins to gain influence in the industry. He highlighted Binance’s extensive reach and size as factors that would allow them to remain relevant in this space, especially when considering its ability to create multiple trading pairs with different denominations of stablecoins, thus creating significant network effects.

Binance Points to Increasing Interest in Non-Dollar-Based Stablecoins

Binance Has Troubles With Its US Partners

Last week, the New York Department of Financial Services (DFS) commanded Paxos to cease minting Binance USD, which is a stablecoin associated with the crypto firm. In response to this order, it was exposed that the Securities and Exchange Commission plans on bringing legal action against Paxos for issuing BUSD without proper registration as an approved security.

Recently, Binance has been battling numerous issues in the U.S., extending beyond its stablecoin saga. Last month, Signature Bank raised transaction minimums to $100,000 for dollar transfers by users with USD bank accounts, and then an announcement was made that Binance’s international customers could no longer use U.S dollars for deposits or withdrawals on the exchange–a move which is only a temporary one at this time.

Before that, the US government issued subpoenas to American hedge funds and market-making businesses trading with Binance in search of records detailing their interactions with the platform.

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