Binance Drops Support For Major Stablecoins To Improve BUSD Liquidity

Crypto exchange Binance has announced that it will no longer support USDC, USDP and TUSD stablecoins while also stating that it will auto-convert all the deposits made using these coins into BUSD, Binance's own stablecoin pegged to the U.S. Dollar.

Binance, the world's biggest crypto exchange by trading volume, published a blog on the matter Sunday, stating that with effect from Sept. 28 at 11 p.m. ET, "users will trade with a consolidated BUSD balance on the Binance Platform that reflects their balances of these four stablecoins (BUSD, USDC, USDP and TUSD) post conversion."

The crypto exchange introduced "BUSD Auto-Conversion" to enhance liquidity and capital efficiency for users. This new feature will convert all the other stablecoin balances into BUSD as mentioned above.

However, the exchange cleared that this decision will only affect deposits and not withdrawals, i.e., those who are withdrawing their funds in USDC, USDP and TUSD, will receive the same in their destination address (the address the stablecoins are being withdrawn to).

Binance also confirmed that it will remove and cease trading on the USDC/BUSD, USDC/USDT, USDP/BUSD, USDP/USDT, TUSD/BUSD, TUSD/USDT spot trading pairs. Moreover, the cryptocurrencies which have trading pairs with these stablecoins like ADA/USDC, ATOM/USDC, etc. will also be put to a halt.

For the users who have money in these stablecoins, they will "be able to view their USDC, USDP and TUSD balances under the BUSD denominated account balance when the conversion is complete," the exchange said.

USDC will be removed as a borrowable asset and as a collateral asset by Sept. 6 at 11 p.m. ET. The exchange will stop USDC Flexible Savings and DeFi Staking subscriptions on Sept. 22 at 11 p.m. ET.

The Twitter community was quick to react to the event.

"Crypto monopoly 101, Binance will remove $USDC as a tradable asset by Sep 25 to push their $BUSD," wrote @BloodgoodBTC on Twitter. "Binance is deleting competitors like Google did 10 years ago."

The largest stablecoin by market capitalization, USDT by Tether, will remain supported on Binance.