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Binance Converts $1B SAFU Fund to USDC, Now 3% of Circulating Supply

Summary:
Binance has announced that it is converting its Secure Asset Fund for Users (SAFU) into Circle’s USD Coin (USDC). Following the B conversion into USDC, this stash now makes up approximately 3% of Circle’s total circulating supply, which is .6 billion. SAFU Assets Shift to USDC for Stability In an April 18 announcement by Binance, the exchange emphasized the importance of SAFU in its ecosystem. Binance stated, “SAFU continues to be a core part of our responsibility to the ecosystem, and we continue to evolve to meet market conditions head-on. Today, we are transferring 100% of SAFU’s assets to USDC.” Today, all SAFU assets will be converted to $USDC, bolstering reliability and stability at bn. Read more 👇 https://t.co/Dggl3CdQYU — Binance (@binance) April 18, 2024

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Binance has announced that it is converting its Secure Asset Fund for Users (SAFU) into Circle’s USD Coin (USDC).

Following the $1B conversion into USDC, this stash now makes up approximately 3% of Circle’s total circulating supply, which is $32.6 billion.

SAFU Assets Shift to USDC for Stability

In an April 18 announcement by Binance, the exchange emphasized the importance of SAFU in its ecosystem.

Binance stated, “SAFU continues to be a core part of our responsibility to the ecosystem, and we continue to evolve to meet market conditions head-on. Today, we are transferring 100% of SAFU’s assets to USDC.”

Binance aims to improve its reliability and maintain stability at $1 billion by using a trusted, audited, and transparent stablecoin for SAFU.

SAFU, created in 2018, functions as an emergency insurance reserve that protects Binance users from severe scenarios like exchange breaches, providing a safety net for potential losses.

Over the years, Binance has diligently monitored the size of the fund, ensuring that it maintains a balance sufficient to protect its users. While usually targeted at $1 billion, the fund’s size undergoes occasional fluctuations.

According to Etherscan data, the SAFU wallet address conducted a transaction of 800 million USDC on the Ethereum network at 02:35 UTC, incurring a transaction fee of $1.88. The conversion process also involved the transfer of 1.36 million BNB valued at approximately $754 million and a transfer of 16,277 BTC.

USDC Now Accounts for 3% of Circle’s Supply

The Binance insurance fund, converted into USDC, is now equal to approximately 3% of Circle’s stablecoin’s total circulating supply, amounting to $32.6 billion.

This marks the fund’s second conversion within just over a year. In March 2023, Binance announced a previous conversion, replacing Binance USD (BUSD) holdings with Tether and TrueUSD (TUSD).

This decision was made to protect users due to regulatory pressures following a crackdown on BUSD issuer Paxos, which announced it was stopping minting the exchange-backed stablecoin.

According to CoinGecko data, Tether maintains its position as the leading stablecoin globally, with a circulating supply of $109 billion and a market share of 69%.

Meanwhile, Circle’s USDC stands as the second largest stablecoin, accounting for approximately 20% of the market share. USDC’s supply has surged by 33% since December, solidifying its position in the stablecoin market.

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