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by joyfylbanana 1291 days ago
Probably not dollars, but some kind of low-risk assets like USD bonds? In that case you also can't just withdraw dollars, you have to sell the bonds - if they have to convert large amount like hundreds of millions, the spread on those bonds might get larger.

Also even though it were just dollars in a regular bank account, when the amounts go large enough, the bank might have liquidity issues of their own.

What would be the biggest issue is the compliance. As rumours are circulating that Binance might be getting some kind of charges, the banks and other institutions might just stop doing business with them because that would increase their risk a lot.
1 comments
vgatherps 1291 days ago
IIRC BUSD is whitelabeled from Paxos so it would probably be fine in the case of Binance troubles.

100MM isn't nothing, but it's very much moveable. Bond markets trade absolutely massive size. Even hen you could tell people "hey, you can't get your USDC, but we're trading out of positions over the next two weeks". Sucks but drastically different than an FTX situation.

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nailer 1290 days ago
It's kinda both a Paxos product and not:

https://paxos.com/busd/

> It is important to understand the distinction between BUSD and Binance-Peg BUSD. These are two different products. Binance USD (BUSD) is a regulated, fiat-backed stablecoin pegged to the US dollar. The Paxos-issued BUSD stablecoin, as well as its reserves, are subject to strict regulatory oversight by the New York Department of Financial Services. BUSD is backed by reserves held in either or both (i) fiat cash in dedicated omnibus accounts at insured U.S. banks and/or (ii) U.S. Treasury bills (including through repurchase agreements and/or money-market funds invested in U.S. Treasury bills).

> Binance-Peg BUSD, which is not issued by Paxos and is not regulated by NYDFS, is a separate product. Binance independently mints Binance-Peg BUSD on other blockchains (e.g., BNB Chain, Polygon and Avalanche) and pegs the tokens to BUSD on a one-to-one basis. This allows holders of both tokens to swap tokens between Ethereum and other blockchains.

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