The largest cryptocurrency exchange, Binance, admitted to having prior issues with regard to handling its stablecoin BUSD reserves, which resulted in more than $1 billion in missing collateral.
Binance said the BUSD pegging had frayed in the past but is now intact. Binance admits the issues surrounding the depegging were due to operational delays.
Binance spokesperson told Bloomberg, “The process of maintaining the peg involves many teams and has not always been flawless, which may have resulted in operational delays in the past.”
However, Binance explained in a blog post after Bloomberg’s article that there was a “timing mismatch” in backing Binance-peg BUSD with BUSD.
“From the data it is clear that the rebalancing did not always keep pace with the demand for Binance-Peg BUSD. Having identified this ourselves last year we now rebalance more frequently to ensure that Binance-Peg BUSD is transparently fully backed.” Binance wrote.
Last year, Binance converted USDC, TUSD, and USDP into BUSD to “enhance liquidity and capital-efficiency for users.” The platform converted these stablecoins and removed the support of USDC, TUSD, and USDP products.
