Binance's $1 billion fund fully transferred to USDC

Iti9

The User Asset Security Fund (SAFU) is an emergency insurance fund established in 2018 to safeguard the assets of Binance users in extreme circumstances, distinguishing it as a crucial component that sets Binance apart from other exchanges. Over the years, Binance has consistently monitored the size of SAFU, maintaining fund balances at levels deemed adequate to protect users, typically set at $1 billion, despite fluctuations.

Evolution of SAFU Allocation Over the Years
On April 18th, Binance announced that 100% of SAFU assets had been moved to USDC. Utilizing a trusted, audited, and transparent stablecoin as SAFU funds further enhances its reliability, ensuring stability at the $1 billion mark. The primary holdings of the SAFU fund include BTC, BNB, USDT, and TUSD. According to official announcements and on-chain data, Binance transferred approximately 16,277 BTC (worth about $1 billion) and around 1,360,000 BNB (worth about $750 million) to the hot wallet, while transferring 1 billion USDC to the dedicated SAFU wallet address.

In 2022, the SAFU fund held $1 billion in assets, including BUSD, BNB, and BTC. BNB accounted for 44%, BUSD for 32%, and BTC for 24%. Criticisms regarding significant risks borne by the SAFU fund arose due to its asset portfolio being primarily composed of the platform's native token, BNB, similar to the FTX incident involving FTT.

In 2023, in March, BUSD, a stablecoin issued by Binance in collaboration with Paxos, came under scrutiny from US regulators. Paxos terminated its collaboration with Binance and ceased minting BUSD. Consequently, Binance announced the conversion of all BUSD holdings in the SAFU fund to TUSD and USDT to safeguard user interests.

Why USDC Is Preferred Over USDT
Contrary to USD stablecoins, USDT, issued by Tether, remains the largest in terms of liquidity, with a market capitalization approaching $110 billion to date, making it the leading USD stablecoin. However, its controversies have escalated, with the SEC questioning its opaque funds or potential hidden risks.

Similar concerns are echoed by analysts at JPMorgan Chase, according to Bloomberg. The team led by JPMorgan analyst Nikolaos Panigirtzoglou highlighted in a report that over the past two years, market concentration of USDT has continued to rise, further solidifying its position as the leading stablecoin. However, the report pointed out that Tether "lacks regulatory compliance and transparency," posing increased risks to the market. JPMorgan analysts favor USDC, ranking second by market capitalization. The report mentioned that Circle, the company behind USDC, has recently been secretly applying for a listing in the United States, highlighting the company's international expansion plans and active preparation for upcoming stablecoin regulations.

Yamini003

There are also a lot of assets.

Jafar224

It's still necessary to choose a wallet with strength for trading.

Iti9

It's said to be insurance, so it must be trustworthy.