Binance USD (BUSD) is a stablecoin issued by Binance, one of the world's largest cryptocurrency exchanges. As a stablecoin, BUSD is designed to maintain a stable value of 1 USD per BUSD token, making it useful for transactions and trading on cryptocurrency exchanges.
BUSD is built on the Ethereum blockchain and is pegged to the U.S. dollar, meaning that each BUSD token is backed by an equivalent amount of U.S. dollars held in reserve by Binance. This ensures that BUSD remains stable in value and can be used as a reliable store of value and medium of exchange within the cryptocurrency ecosystem.
BUSD is a popular choice for cryptocurrency traders and investors who want to move funds between different exchanges or wallets without having to convert their holdings back into fiat currency like U.S. dollars. BUSD can be used to trade against other cryptocurrencies on Binance and other exchanges, and it can also be used to purchase goods and services from merchants who accept cryptocurrencies.
While BUSD has several advantages, it also has a few disadvantages that are worth noting:
Overall, while BUSD is a relatively stable and reliable stablecoin, it is not without its risks and limitations. As with any cryptocurrency or financial instrument, it is important for investors to carefully consider the risks and benefits before investing in BUSD.
The article does not constitute financial advice.