In the last 30 days, BUSD lost $1 billion in its market capitalization.
The Binance USD (BUSD), a Binance and Paxos stablecoin pegged to the US dollar, has been toppled from its podium position in the stablecoin rankings and now holds the fourth spot.
In September 2019, Binance and Paxos Trust collaboration issued the BUSD stablecoin. Paxos owns and launches the product, while Binance provides its branding.
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Recent data illustrates this downward shift. The cryptocurrency's market capitalization has experienced a dip exceeding a whopping $1 billion in the last 30 days alone.
Currently, the market capitalization for BUSD is approximately $4.3 billion. A month ago, this figure stood at a robust $5.54 billion. This represents a significant 29% decrease within a short period. Looking back to December 2022, BUSD had an even higher market capitalization, peaking at $23 billion.
BUSD's market capitalization decrease mirrors the struggles of the cryptocurrency exchange platform, Binance. These struggles began with the fall of FTX in November 2022 and were further fueled by a December 2022 report that suggested the US Department of Justice would put Binance in its crosshairs.
Paxos also faced some obstacles following its collaboration with Binance, particularly when it was served a Wells notice from the US Securities and Exchange Commission. The commission alleged that the BUSD was an unregistered security, which initiated an investigation and caused the New York Department of Financial Services to halt the issuance of BUSD.
The trend of other stablecoins pegged to the US dollar has also seen some upheavals over the past year.
Tether (USDT) has regained its former glory, returning to an all-time high even as other stablecoin market caps shrank. USD Coin (USDC) from Circle has seen a decrease in its market share from 34.88% in May 2022 to 23.05% in May 2023. Dai's (DAI) share of the cryptocurrency market slipped from 4.05% to 3.66% over the same period.
The recent legal and operational issues plaguing Binance have had a clear negative impact on BUSD's standing.
