SEC Pressure Causes USDC and BUSD Troubles: What’s Next?
28. Februar 2023 | by admin
• The US Securities and Exchange Commission (SEC) issued a Wells notice to the BUSD issuer Paxos earlier this month.
• Since then, the number of USDC sending addresses and BUSD transfers have dropped to 1-month and 5-month lows respectively.
• The mean transaction volume for BUSD has surged to 8-month highs, while its market cap has fallen by nearly $6 billion.
SEC’s Pressure on Stablecoins
The US Securities and Exchange Commission (SEC) recently issued a Wells notice to the BUSD issuer Paxos, causing drops in both USDC sending addresses and BUSD transfers. Data provider Glassnode reported that the seven-day median average of USDC sending addresses had dropped to a one-month low of 1,384.976, while the number of BUSD transfers had decreased to a five-month low of 85.720.
BUSD’s Mean Transaction Volume Surge
On the other hand, Glassnode also reported an eight-month high in terms of mean transaction volume for BUSD with $886.3 million being recorded as its seven-day median average. This was an increase from its previous eight-month high which was recorded on August 23rd 2022 at $880.9 million according to data provided by Glassnode itself.
Market Cap Fall for Both Coins
CoinMarketCap data shows that USDC’s total market cap fell from around $42 billion before news broke out about SEC’s pressure on stablecoins to around $40 billion after Changpeng Zhao (CZ), CEO of Binance tweeted about it on Valentine’s Day. Similarly, Binance USD’s market cap has reduced from over 16 billion at the time when CZ tweeted about SEC’s pressure to under 11 billion at present according to CoinMarketCap data.
Circle CEO Reacts To SEC Pressure On Stablecoins
Jeremy Allaire, CEO of Circle which is the issuer behind USDC gave his opinion on this situation saying that SEC may not be the right regulator watch stablecoins but rather banking regulators could be more suitable for this role according to what he said on February 24th 2021 during his statement regarding this issue .
It is clear that SEC’s pressure on stablecoins has caused significant losses in terms of capitalization for both USDC and BUSD as well as drops in number sending addresses and transactions numbers for these coins with only some minor gains seen in terms of mean transaction volumes where it reached 8 month highs according to Glassnode’s data although some people think that banking regulators would be better suited than SEC when it comes down regulating stablecoins such as those two mentioned above .