A stablecoin issued by Paxos, in partnership with cryptocurrency exchange Binance, whose price is tied 1:1 to the US dollar.
Mission
A digital fiat currency for the digital age, BUSD is backed by US dollars held in reserve accounts in US banks and regulated by the New York State Department of Financial Services.
Use-cases
In a similar way to fellow stablecoins Tether and USDC, BUSD serves as a place where crypto investors can shelter from the extreme volatility of other cryptocurrencies.
Issued as the ERC-20 technical standard token (Ethereum) and supporting BEP-2 (Binance Coin), it works with several blockchains and all major wallets and exchanges.
Founders
Paxos is a FinTech unicorn founded in 2012 which has built a regulated blockchain infrastructure platform. It serves as a crypto brokerage, allows people to trade gold and provides a settlement solution for the commodities and FX markets.
Binance is a centralised cryptocurrency exchange which takes fees from coin transactions.
Economics
Whenever a quantity of BUSD is bought, an equivalent amount of BUSD is created for the purchase and a dollar payment matching the total added to Paxos’s reserve accounts. When someone sells BUSD, the equivalent dollar payment is removed from the bank while the BUSD is burned out of the system.
Accounting firm Withum conducts an audit for BUSD every month which is publicly available.