Binance USD

BUSD/USD Forecast – Historical Price Trends & Peg Accuracy of Binance USD to US Dollar

The BUSD/USD currency pair tracks the value of Binance USD, a U.S. dollar-pegged stablecoin, against the U.S. Dollar. While this may seem redundant, tracking BUSD/USD is critical for analyzing peg stability, depegging risks, and the broader confidence in stablecoin infrastructure.

Launched in 2019 by Binance in partnership with Paxos Trust, BUSD was one of the most widely used regulated stablecoins until 2023. Its price is expected to remain close to $1.00, but fluctuations during market volatility or regulatory stress can reveal systemic vulnerabilities.

Historical Overview of BUSD Price Trends and Peg Accuracy

Though BUSD was not designed for speculation, its price history provides insights into the health of crypto liquidity, exchange confidence, and regulatory impact on stablecoins.

2019–2020: Launch and Initial Adoption

• September 2019: BUSD was launched with full regulatory approval from the NYDFS and custody by Paxos.

• Peg remained tightly at $1.00, with minimal deviations.

• Adoption was driven by Binance’s trading pairs and DeFi integrations.

2020–2021: DeFi Expansion and Trading Volume Growth

• BUSD became a core stablecoin on Binance and PancakeSwap.

• It briefly became the third-largest stablecoin after USDT and USDC.

• Its market cap grew from $250 million to $14 billion during the bull market.

• Peg remained stable with fluctuations mostly within ±0.002 USD.

2022: Bear Market and Reserve Confidence

• During the market crash and collapse of TerraUSD (UST), BUSD was seen as a safe stablecoin, benefiting from Paxos-backed reserves.

• BUSD usage grew as investors exited volatile assets.

• Peg remained highly stable even during systemic stress.

2023: Regulatory Blow and Wind-Down Announcement

• In February 2023, the New York Department of Financial Services (NYDFS) ordered Paxos to halt new issuance of BUSD.

• The SEC declared BUSD as an unregistered security.

• Binance allowed continued usage, but no new BUSD was minted after March.

• Market cap dropped from $16 billion to below $5 billion by December.

• Peg largely held, but occasional slippage reached $0.98–$1.02 during peak uncertainty.

2024–2025 (YTD): Gradual Phase-Out and Liquidity Drain

• Binance announced that BUSD would be fully wound down by February 2024.

• Users were encouraged to convert BUSD to other stablecoins (USDT, TUSD, FDUSD).

• As of 2025, BUSD exists in limited circulation, with under $100 million in liquidity.

• Peg has shown increasing volatility due to reduced redemption mechanisms, with occasional trades at $0.985–$1.03.

Year-Wise BUSD/USD Comparison Table (with Peg Accuracy Check)

*2025 data is YTD as of April.

BUSD’s Stablecoin Mechanism: Why It Was Different

Unlike algorithmic or collateral-backed stablecoins (like DAI or UST), BUSD was:

• Fiat-backed 1:1 with U.S. dollars or U.S. Treasury assets.

• Audited monthly by an independent third party.

• Custodied by Paxos Trust, a regulated financial entity.

The combination of transparency, regulation, and Binance ecosystem support made BUSD a preferred stablecoin for:

• Spot trading

• DeFi protocols on BSC

• Savings and lending (e.g., Venus, Alpaca)

• NFT marketplaces

• Derivatives margin collateral

Regulatory Pressure and Market Exit

BUSD’s downfall was not technical but regulatory. Key events include:

• Feb 2023: NYDFS orders Paxos to cease BUSD minting.

• SEC Wells Notice against Paxos for alleged securities violations.

• Binance shifts focus to other stablecoins like FDUSD, TUSD, and USDT.

• BUSD redemptions honored until early 2024, with full support ending in February 2024.

As of 2025, Paxos no longer supports redemptions, and BUSD liquidity is thin. Some DeFi protocols have deprecated BUSD entirely, while Binance has delisted many BUSD trading pairs.

BUSD’s Impact on the Crypto Ecosystem

Even in decline, BUSD’s legacy remains significant:

• Introduced a model for regulated, fiat-backed stablecoins tied to major exchanges.

• Helped facilitate mass DeFi adoption on Binance Smart Chain (BSC).

• Set a standard for monthly reserve attestations and transparency.

• Served as a stress test for regulatory enforcement on centralized stablecoin issuers.

BUSD vs Other Stablecoins in 2025

As stablecoins evolve, newer entrants like FDUSD and decentralized options like DAI are filling the void left by BUSD. Despite its shutdown, BUSD’s design and regulatory model shaped the modern landscape of compliant stablecoin frameworks.