The supply of BUSD, a stablecoin that was once among the largest, has dropped to its lowest point in two years, according to statistics recorded on April 15, 2023. The number of coins in circulation has dropped below the 7 billion range to 6.68 billion, marking a 19.8% decrease in supply over the past 30 days. The decline in BUSD’s supply can be attributed to Paxos’ announcement on February 13, 2023, that the New York State Department of Financial Services (NYDFS) had directed the company to stop issuing BUSD. On that day, around 16.1 billion BUSD tokens were in circulation, and since then, 9.42 billion stablecoins have been redeemed.
Despite the decrease in supply, BUSD remains the third-largest USD-pegged token. 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. However, on April 15, 2023, with its much smaller market valuation, BUSD’s 24-hour global trade volume is approximately $2.61 billion.
Seven out of the top ten largest BUSD wallets belong to Binance, the largest crypto exchange by trade volume. All ten wallets hold 92.52% of the ERC20 version of the BUSD supply, according to current data. Binance 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 that hold 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.
If the redemptions continue, the stablecoin issued by the Makerdao protocol DAI will soon surpass BUSD’s current number of tokens in circulation. Presently, there is $5,016,181,138 DAI in circulation, but the DAI supply has also decreased over the past 30 days by 13.6%.
This development highlights the volatility of stablecoins and the importance of maintaining a stable supply. The decline in BUSD’s supply may have a significant impact on its value and market capitalization. It remains to be seen how this will affect the wider cryptocurrency market and whether other stablecoins will follow suit.
In conclusion, the decrease in BUSD’s supply is a significant development in the cryptocurrency market. It highlights the importance of maintaining a stable supply and the potential impact of regulatory intervention. As the cryptocurrency market continues to evolve, it will be interesting to see how stablecoins adapt to changing market conditions and regulatory frameworks.