Crypto Whales Fluctuate Between BUSD and USDC Following SEC Action
- A fear indicator chart shows whales fluctuating between USDC and BUSD.
- BUSD lost nearly $10 billion of its market share after the SEC action.
Recent events illustrate that the US Securities and Exchange Commission (SEC) has stirred the crypto market by labeling Binance’s native stablecoin BUSD as an unregistered security. According to data from a crypto analytic firm Santiment, the SEC’s action generated panic among whale holders of BUSD, as reflected in a fear indicator on the charts.
The fear indicator shows that whale holders of BUSD have been fluctuating between Circle stablecoin USDC and BUSD in the wake of the SEC’s lawsuit. The analytic firm noted that the uncertainty led to a decrease in whales’ overall supply of the BUSD.
Furthermore, data from the market tracking website, CoinMarketCap, showed BUSD had lost nearly $10 billion of its market share after the SEC action. BUSD had almost $17 billion in market valuation as of January 1, 2023, ranking sixth among the coins with the largest market cap.
Unfortunately, BUSD is nearly falling off the top ten ranking as its market share has fallen below the market cap of the popular meme Dogecoin (DOGECOIN). Conversely, other cryptos, such as the Tether USD (USDT) and the Binance Coin (BNB), have benefited significantly from the regulatory push against BUSD.
The market shares of USDT and BNB went up by over $5 billion from their January value since the SEC sent a Wells Notice to Paxos Trust Co, the issuer of BUSD, informing it of an impending enforcement action for selling an unregistered security.
A crypto trader theorized that the absence of BUSD on the market would put BNB in a better position as more people would need to buy and hold more BNB for fees discount on the spot market.