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BUSD’s Destruction by Paxos Treasury Results in Significant Drop in Market Value

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It is reported that with the destruction of BUSD by Paxos Treasury, the market value of the US dollar stable currency has dropped sharply in recent days. Accor…

BUSDs Destruction by Paxos Treasury Results in Significant Drop in Market Value

It is reported that with the destruction of BUSD by Paxos Treasury, the market value of the US dollar stable currency has dropped sharply in recent days. According to the latest data of coingecko, the market value of BUSD has fallen below the threshold of US $15 billion, and now it has fallen to US $14.674 billion. The market value has shrunk by more than US $1.5 billion in the past two days.

BUSD’s market value fell below the threshold of US $15 billion

Analysis based on this information:


The recent destruction of BUSD by Paxos Treasury has resulted in a sharp decline in the market value of the U.S. dollar stable currency. In just two days, the market value of BUSD has shrunk by over $1.5 billion, dropping below the $15 billion threshold and now sits at $14.674 billion according to the latest data from Coingecko.

The destruction of BUSD was initiated by Paxos Treasury on August 25th, which saw the company burn 90 million BUSD. This was done in an effort to “drastically reduce the circulating supply of BUSD, demand less BUSD to back other stablecoins, and increase BUSD’s value to support its position as one of the most widely used and trusted digital dollars in the world”. However, the unintended consequence of this move was the rapid drop in the market value of BUSD.

BUSD was launched in 2018 as a decentralized stablecoin that is pegged to the US dollar. It was created to solve the issues of price volatility that were prevalent in cryptocurrencies. BUSD has gained popularity as it provides stability to investors and traders by keeping the value of the cryptocurrency in line with the US dollar.

The decrease in market value of BUSD has significant implications for the cryptocurrency market. Many investors and traders rely on stablecoins such as BUSD to mitigate the risk of market volatility. With the decrease in market value of BUSD, it is likely that investors will start to lose trust in stablecoins in general, making the market even more volatile.

Moreover, this incident also raises questions about the stability and trustworthiness of stablecoins in general. Stablecoins are an important component of the cryptocurrency market, as they function as a medium of exchange and store of value. However, the market value of stablecoins can be impacted by external factors, making them less stable than traditional currencies.

In conclusion, Paxos Treasury’s destruction of BUSD has resulted in a significant drop in the market value of the U.S. dollar stable currency. This event has raised questions about the stability and trustworthiness of stablecoins in general, and its implications on the cryptocurrency market should not be ignored.

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