Binance to buy $1 billion worth of bitcoin for stabilization fund
The Binance exchange will purchase bitcoin worth $1 billion for the SAFU stabilization fund, which was established in 2018.
The editorial team of Happy Coin News learned that the trading platform plans to exchange the USDC stablecoins (USDC) held in SAFU, valued at nearly $1 billion, for BTC. If, due to a decline in cryptocurrency prices, the value of the assets in the fund falls below $800 million, the company will rebalance the assets so that their value returns to $1 billion.
Being confident that BTC is a key element of the cryptocurrency ecosystem and will retain its value in the long term, Binance employees will support the digital asset industry during market cycles and periods of uncertainty by systematically allocating resources to the cryptocurrency sector, the exchange’s representatives noted.
SAFU is funded by trading fees earned by Binance and serves as a reserve fund created to protect the company’s clients’ funds. The name of the fund originates from the title of a meme video uploaded to YouTube in 2018, Funds Are Safu, meaning that the assets are safe.
USDC stablecoins on SAFU’s balance sheet
Binance has not yet converted USDC into BTC, likely due to the renewed bearish trend, which threatens to push the bitcoin price lower (currently $82,592). It is quite possible that the exchange’s staff will wait until the coin’s price reaches a bottom and then purchase the cryptocurrency for the stabilization fund so that the value of the reserves increases during a rebound.
See also: "Crypto exchange Coinbase is conducting internal testing of the USDF stablecoin"
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