In a recent announcement, Binance, one of the leading cryptocurrency exchanges globally, revealed its plans to expand free trading options for the spot and margin trading pairs of the First Digital USD (FDUSD) stablecoin. This move comes as part of Binance’s ongoing efforts to promote the use of FDUSD. The trading pairs that will benefit from zero maker and taker fees include BNB, Dogecoin, Chainlink, Ethereum, Solana, and XRP. Starting from December 8, users will be able to take advantage of this promotion for an undisclosed period.
While Binance aims to encourage the adoption of FDUSD, the exchange clarified that the free trading option would not apply to BNB fee discounts, rebates, and other adjustments. Moreover, the company emphasized its commitment to maintaining a fair and transparent trading environment by reserving the right to disqualify trades that exhibit attributes of self-dealing, market manipulation, wash trades, or illegally bulk account registrations.
As part of its broader strategy, Binance announced plans to phase out support for its native stablecoin, Binance USD (BUSD). By December 15, Binance urged users to convert their BUSD holdings into FDUSD. To facilitate this transition, the exchange will end BUSD withdrawals by December 31, automatically converting the remaining BUSD balances to FDUSD.
This decision by Binance is directly linked to regulatory challenges faced by BUSD. Earlier this year, Paxos, the issuer of BUSD, suspended stablecoin issuance due to scrutiny from U.S. regulators. The U.S. Securities and Exchange Commission (SEC) classified BUSD as a security, which both Binance and Paxos strongly contested. However, the regulatory uncertainty surrounding BUSD led to a significant decline in its circulating supply, dropping to less than $2 billion at the time of writing, according to CryptoSlate’s data.
Concurrently, Binance has been actively promoting First Digital USD (FDUSD) as a viable alternative to BUSD. In addition to expanding free trading options for FDUSD pairs, Binance has introduced new products and incentives to encourage its use. Despite these efforts, FDUSD’s circulating supply remains relatively low, currently standing at less than 1 billion, and it is available on only a handful of cryptocurrency exchanges.
With the expansion of free trading options and the phasing out of BUSD, Binance is entering a new era. The exchange is intensifying its focus on FDUSD and aims to position it as a strong contender in the stablecoin market. By encouraging users to adopt FDUSD, Binance seeks to diversify its offerings and provide a stablecoin that overcomes the regulatory obstacles faced by BUSD.
As the cryptocurrency market continues to evolve, Binance’s strategic decisions and product offerings will shape its future trajectory. The success of FDUSD hinges on Binance’s ability to build trust and gather support from users and the broader crypto community. Only time will tell if Binance can solidify FDUSD’s position and establish it as a prominent stablecoin in the digital asset landscape.