Binance USD (BUSD)

Trading and Payments

Binance USD is a stablecoin pegged 1:1 to the US dollar, used for trading on Binance and other exchanges. It allows users to buy, sell, and trade cryptocurrencies with a stable value. It is also accepted as a payment method for goods and services, including real-world uses like booking hotel rooms via QR codes.

Stability and Hedging

Because it is backed by US dollars held in reserve, Binance USD helps users avoid the price swings common in other cryptocurrencies. This makes it useful for hedging against market volatility and maintaining a stable store of value.

Cross-Chain and Interoperability

Binance USD operates on multiple blockchains such as Ethereum and Binance Smart Chain, making it versatile for use across different decentralized finance (DeFi) platforms and blockchain networks.

Yield and Liquidity

Users can stake or lend Binance USD on various DeFi protocols and centralized platforms to earn rewards or interest. It is also used in liquidity pools to facilitate trading and decentralized finance activities.

Fast and Low-Cost Transfers

Binance USD enables quick, low-fee transfers of value internationally, verified on public blockchains within seconds, making it convenient for sending money across borders.

For more details, visit the official Binance USD page on Binance: https://www.binance.com/en/busd/

Pros of Binance USD

• Low Fees: Binance USD offers very low trading fees, especially on crypto-to-crypto trades, making it cost-effective for frequent traders.
• Wide Cryptocurrency Selection: Supports over 150 cryptocurrencies, giving users many options to trade or invest.
• Staking Rewards: Users can earn staking rewards on about 17 coins, with some rates reaching double digits, paid weekly.
• User-Friendly Interface: The platform provides useful charts and an intuitive design suitable for many users.
• No Deposit Fees for Crypto: Depositing cryptocurrencies is free, which helps reduce costs.
• Instant Buy/Sell Options: Allows quick trades with fees ranging roughly from 0.25% to 0.5%.
• Binance Pay: Enables sending and receiving crypto between users with no fees up to $1 million daily.

Cons of Binance USD

• Regulatory Issues: Faces serious regulatory scrutiny and legal challenges, especially from the U.S. SEC, which may affect operations.
• USD Deposit Suspension: Currently, USD deposits and withdrawals are suspended, limiting fiat currency use.
• Staking Fees: Takes a service fee of 25% to 35% from staking rewards.
• Limited U.S. Availability: Not available in all U.S. states due to regulatory restrictions.
• Withdrawal Fees: While deposits are free, withdrawals may incur fees depending on the asset and network conditions.
• Complex for Beginners: The platform’s advanced features and trading options can be confusing for new users.

For more details, visit the official Binance USD website.

Founders of Binance USD

Binance USD is a stablecoin issued by Paxos in partnership with Binance. The main founders behind Binance and the Binance ecosystem, including Binance USD, are:

• Changpeng Zhao (CZ): He is the founder and former CEO of Binance, the largest cryptocurrency exchange in the world. CZ is a Chinese-Canadian entrepreneur who started Binance in 2017.
• He Yi: She is a co-founder of Binance and has played a key role in the company’s growth, especially in marketing and strategy.

Binance USD itself is issued by Paxos, a regulated financial institution, on behalf of Binance. The stablecoin is backed by U.S. dollars held in reserve.

For more details, visit the official Binance website: binance.com

Investors in Binance USD

Binance USD (BUSD) is a stablecoin issued through a partnership between Binance and Paxos, a blockchain and finance company based in New York. Paxos holds the fiat USD reserves backing BUSD.

Investors in Binance.US (U.S. platform related to Binance USD)

Binance.US, the U.S.-based crypto trading platform affiliated with Binance, raised $200 million in a seed funding round on April 6, 2022. This round included 13 investors, mainly institutional, such as:

• Fundamental Labs (lead investor)
• RRE Ventures
• Foundation Capital
• Original Capital
• VanEck
• Circle Ventures
• Plus several other institutional investors

The platform is valued at about $4.5 billion as of that funding round.

Summary

• Binance USD is backed by Binance and Paxos.
• Binance.US raised $200M from 13 institutional investors led by Fundamental Labs.
• Other notable investors include RRE Ventures, Foundation Capital, VanEck, and Circle Ventures.

For more details, visit Binance.US.

Halal Status of Binance USD

• Yes, Binance USD is generally considered halal because it is a stablecoin fully backed by USD reserves held in regulated banks.
• It operates transparently with regular audits and no interest (riba) involved in its issuance or redemption.
• As a stablecoin, it functions as a digital representation of real-world assets, which aligns with Islamic finance principles of asset-backed financing.

For more details, you can visit the official Binance website or consult Islamic finance experts.