Why Binance, the largest Crypto exchange in the world, is enthusiastic about stable coins

Binance has unveiled a series of new products and functions related to stablecoins – with & # 39; the world's largest cryptocurrency exchange that describes these digital assets as & # 39; an efficient fiat gateway in crypto & # 39 ;.

Stablecoins are often linked to a fiat currency, meaning that a unit can be directly equated to 1 euro or $ 1. With new coins popping up, the sector is evolving rapidly, leading the company to maintain a stable income market market where its consumers can benefit from links with other cryptocurrencies.

The crypto-only exchange now supports a total of five stablecoins: Paxos Standard Token (PAX), TrueUSD (TUSD), USD Coin (USDC), StableUSD (USDS) and Tether (USDT).

As reported by Cointelegraph, Binance CEO Changpeng Zhao has spoken about his support for stablecoins because he believes they "offer much more freedom than traditional fiat for users" and help regulators maintain control. In November the exchange introduced its combined Stablecoin Market, creating a place where a wider range of assets can be used as base pairs.

Binance claims that "it is now often more efficient to buy cryptocurrency via stablecoins than via a fiat exchange" – not least because of how stablecoins are less susceptible to high transaction costs and market volatility.

The advantages

When explaining the rationale behind the use of stablecoins, Binance says that it can help to eliminate the confusion that all too often revolves around exchange rates. Given how the prices of other coins and tokens can change dramatically in a few minutes, this increasingly popular form of cryptocurrency can help provide the security that many ordinary consumers want and expect. Over time, this could also enable the sector to build up a convincing case for regular acceptance. Some concerns are that many digital assets represent a value store instead of a currency that can be used for daily purchases.

Binance is available here

The financial plus side cannot end here either. In a blog post on stablecoins, Binance said: "There are minimal or no costs when converting US dollars to stablecoins and back." The exchange explains that this is mainly because these transactions eliminate the costs associated with making electronic transfers during the fiat-to-crypto conversion phase. There may also be benefits when cryptocurrencies are changed back to fiat, because the use of stablecoins can help consumers avoid the higher withdrawal costs that are often levied by fiat-focused exchanges.

To help save crypto enthusiasts, Binance advises consumers to turn their fiat into stablecoins by using the official websites of the five it supports – all of which have "simple, trusted channels" to keep the transactions smooth. expired. From there, transfers to the crypto exchange can be & # 39; fast and traceable & # 39; to be. For those who subsequently want to buy Bitcoin or Ethereum using a stablecoin, Binance says that the maximum trading costs associated with such a conversion are only 0.1 percent.

Chase the regular adoption

The transition from Binance to stablecoins is a response to the growing interest of the crypto community. Indeed, as reported by Cointelegraph, a study published in February predicted that stablecoins will play an important role in the regular introduction of this technology – something that has so far proved elusive.

The report predicts that countries that have suffered from hyperinflation in the past, when fiat currencies dropped to the extent that everyday essentials become unaffordable, are most likely to embrace stablecoins first. And several nations are currently in the grip of hyperinflation, including Venezuela, Zimbabwe and Angola.

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