Binance’s 1 billion Dollars emergency SAFU fund now represents 3% of the USDC supply

Crypto News– Binance, the world’s largest crypto exchange, is converting its Secure Asset Fund for Users (SAFU) into Circle’s USD Coin (USDC) stablecoin and now holds 3% of its circulating supply.

Binance’s 1 billion Dollars emergency SAFU fund now represents 3% of the USDC supply

The company announced the move on April 18, stating that we are transferring 100% of SAFU’s assets to USDC but didn’t elaborate on why, other than it was making use of a trusted, audited, and transparent stablecoin for SAFU, which further enhances its reliability and ensures it remains stable at $1 billion.

The exchange’s Secure Asset Fund for Users is an emergency insurance fund established in 2018 to protect Binance users in extreme situations, such as exchange hacks, where users could be reimbursed for unforeseen losses.

According to Etherscan, the SAFU wallet address conducted a transaction of 800 million USDC on the Ethereum network at 2:35 am UTC, with a transaction fee of only $1.88.

There was also a transfer of 1.36 million BNB worth around $754 million and a transfer of 16,277 BTC as part of the conversion process.

The billion-dollar Binance insurance fund now represents around 3% of the $32.6 billion supply of Circle’s stablecoin.

This is the second conversion of the fund in just over a year. In March 2023, Binance announced that it had replaced the Binance USD (BUSD) holdings in the SAFU with Tether (USDT) and TrueUSD (TUSD).

The move at the time was in response to a regulatory crackdown on BUSD issuer Paxos, which announced that it would stop minting the exchange-backed stablecoin.