Binance Cryptocurrency Exchange Considers Launch of Its Stablecoin

The CEO of Binance Changpeng Zhao in a response to a Twitter user who suggested the exchange should launch a stablecoin suggests he is considering launching one. The Twitter user said a stablecoin from Binance would become a major token on the Binance blockchain and there is no reason why the exchange shouldn’t launch one.

Binance launched its cryptocurrency Binance Coin (BNB) in 2017 and the coin has been largely successful. BNB was referred to as the new Bitcoin at some point because it was determining market direction i.e the market fell or rose as its price changed.

Binance is also the largest crypto exchange by adjusted transaction volume and has maintained that position for a long time. Changpeng Zhao’s influence in the cryptocurrency industry is so great that other exchanges could delist a token that his exchange delisted first.

This is why a stablecoin launched by the exchange can have a significant impact and probably grow faster than other stablecoins have. The recent event concerning Tether, however, may have reduced the popularity of stablecoins in the industry.

Stablecoins are cryptocurrencies just like Bitcoin and XRP, only they are backed by some more stable currency such as the U.S Dollar. Tether was said to be backed by the USD thus giving it a stable value so that users can pay for goods and services without having to worry about value fluctuation. However it was discovered during the court case following the suit that only 74% of USDT is backed by the USD.

This has sent chills down the spines of cryptocurrency users when it comes to stablecoins and it might take a while for that to go away. Launching a new stablecoin at this time therefore may not be a good idea but who is to say what possibilities lie ahead of Binance’s possible new stablecoin?

The whole cryptocurrency market is just recovering from the problems caused by Tether USDT. Bitcoin is over $5,400 and Ethereum is over $160 while XRP is in the reds with Binance Coin and of course Tether USDT among the top ten cryptocurrencies. But if Binance will launch a stablecoin that brings more good to the ecosystem that bad, why not?