Binance wants more stablecoins
If there's demand you might as well satisfy it.
Binance has been adding stablecoins lately, with the most recent being Paxos in late September.
But there's more to come, or so Binance hopes, said chief financial officer Wei Zhou to CoinDesk.
Timing is everything
The news comes as Tether is still wavering around its peg, having lost parity in a big way this week.
The event bore comment from Binance CEO Changpeng "CZ" Zhao.
Regulated stable coin, lol pic.twitter.com/5SRMhhh32Y
— CZ Binance (@cz_binance) October 13, 2018
But Binance as a whole is still happy to stick with Tether, Wei Zhou said.
"As a whole, we believe things will even out. We will continue to support USDT," Wei said.
He sees a lot of potential in the stablecoin space as a whole, citing the many traders who are always keen for a safe haven during market slip-ups, and have historically tended to find one in Tether.
"We do believe this stablecoin, as an entity, is critical for our ecosystem right now because it offers an alternative for investors to park their assets in something they can relate to," he said.
He also notes the use of stablecoins as part of Binance's core mission of extending financial services to the underbanked around the world. Specifically, he notes the use of US dollar pegged stablecoins which are often preferred in regions where the US dollar has become a de-facto alternative to the local currency, on account of its relative stability and consistent value.
After all, there wouldn't be much point in creating a stablecoin pegged to the Venezuelan bolivar, and even if one did it probably couldn't be rightly called a stablecoin.
It's similar in Uganda, where Binance recently opened up shop, Wei said.
"Rather than hold bitcoin, [institutions] actually prefer to hold more stablecoins, because the dollar is still the default currency in some of these countries. That's just one use case that we've seen that's different in this part of the world [Uganda] versus other parts of the world," he said.
There's a lot of demand, and perhaps a lot of room in the market for multiple USD pegged stablecoins. Especially with Tether's receiving market share leaving more room for more reliable alternatives.
And if there's demand, Binance might want to be there to catch it.
Disclosure: At the time of writing the author holds ETH, IOTA, ICX, VET, XLM, BTC, ADA
- What we learnt from the rise and fall of the DigixDAO autonomous organisation
- BIS survey suggests Libra blindsided central banks, stablecoin use in EMEs
- Chamber of Digital Commerce sides with Telegram in SEC lawsuit
- Reserve Bank of India vs cryptocurrency: RBI cites Libra as point against crypto
- Digital Dollar Foundation: Why the former CFTC head is pushing for digital USD