On April 15, 2023, statistics revealed that the supply of the stablecoin BUSD had fallen below the 7 billion range to 6.68 billion, marking the lowest number of BUSD in circulation since April 2021. The data shows that the supply of BUSD has reduced by 19.8% over the past 30 days. BUSD, which was among the largest stablecoins, today remains the third-largest USD-pegged token. On February 13, 2023, Paxos announced that the New York State Department of Financial Services (NYDFS) had directed the company to stop issuing BUSD. During this time, there were around 16.1 billion BUSD tokens in circulation, and since then, 9.42 billion stablecoins have been redeemed.
BUSD’s Market Capitalization
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Between March 15 and April 15, 2023, BUSD’s supply decreased by 19.8%. In mid-November 2022, BUSD’s market capitalization was at its highest point ever at $23.49 billion, with a global trade volume of over $11 billion within a 24-hour period. As of April 15, 2023, with its much smaller market valuation, BUSD’s 24-hour global trade volume is approximately $2.61 billion.
Binance Controls BUSD’s Circulating Supply
Nansen’s statistics reveal that Binance, the largest crypto exchange by trade volume, holds 6.1 billion BUSD, according to Nansen’s exchange portfolio tool that shows the trading platform’s reserve balances. The BUSD rich list shows that the top ten holders, including Binance’s stash, hold 92.52% of the circulating supply out of 166,645 unique addresses holding BUSD. Furthermore, the top 100 BUSD holders own approximately 96.09% of the stablecoin’s current supply. Binance-associated addresses control seven out of the top ten largest BUSD addresses.
DAI, Redemptions, and Circulation
If the redemptions continue, the stablecoin issued by the Makerdao protocol DAI will soon surpass BUSD’s number of tokens currently in circulation. Presently, there is $5,016,181,138 DAI in circulation, but over the past 30 days, the DAI supply has also decreased by 13.6%.
Closing Thoughts
The decrease in BUSD’s circulating supply since February 13, 2023, may have happened for several reasons. Due to compliance and regulatory oversight, the NYDFS directed Paxos to stop issuing BUSD, which led to some holders redeeming their BUSD tokens. Additionally, Binance controls a significant portion of the circulating supply, which suggests that it may be more susceptible to Binance’s overall trading activity. Meanwhile, the decline in BUSD’s circulating supply may also be linked to specific market conditions, underscoring the importance of staying on top of market trends to invest diligently.
