Binance, the world’s biggest cryptocurrency exchange, recently came clean about prior failures in the management of its stablecoin BUSD reserves. These failures led to the loss of more than one billion dollars worth of collateral.
Binance said that the USD peg for BNB has been loose in the past but is presently stable. Binance has acknowledged that the problems that surrounded the depegging were caused by delays in operating procedures.
According to a representative for Binance, Bloomberg quoted them as saying, “The process of maintaining the peg includes several teams and has not always been faultless, which may have resulted in operational delays in the past.”
However, in a blog post that was published following the Bloomberg piece, Binance indicated that there was a “timing mismatch” in the process of supporting Binance-peg BUSD with BUSD.
“From the data it is clear that the rebalancing did not always keep pace with the demand for Binance-Peg BUSD. Having identified this ourselves last year we now rebalance more frequently to ensure that Binance-Peg BUSD is transparently fully backed.” Binance wrote.
In order to “improve liquidity and capital-efficiency for users,” Binance changed USDC, TUSD, and USDP into BUSD in December of last year. The platform changed the value of these stablecoins and discontinued support for items denominated in USDC, TUSD, and USDP.
Compiled by Coinbold
