Binance Rolls Out Zero-Fee Stablecoin But Hits Pause Soon After: Here's Why
First Digital USD (FDUSD), a newly introduced stablecoin scheduled to make its debut on Binance on Wednesday has now faced a halt due to technical difficulties.
A Bumpy Start To The FDUSD Journey
The expected listing of FDUSD on Binance was initially set for July 26, 2023. To incentivize traders, Binance planned to offer zero maker fees for all FDUSD trading pairs. However, due to technical issues encountered by the FDUSD pairs’ liquidity providers, the launch was postponed.
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Trading was halted at 09:45 (UTC), and all pending FDUSD orders were canceled, reflecting the exchange’s commitment to user protection amid these unforeseen circumstances.
In response to these technical glitches, Binance rescheduled the FDUSD listing for the same day at 14:00 (UTC). However, the delay caused by the technical issues put a temporary damper on the excitement surrounding the FDUSD launch.
First Digital USD: Just Another Stablecoin?
First Digital Group, a conglomerate including Hong Kong-based First Digital Trust, a custodian and trust firm, unveiled the plan for the FDUSD stablecoin in June. Backed by FD121, the stablecoin, pegged to the US dollar on a 1:1 ratio, promised to be fully backed by cash and cash equivalents held in regulated financial institutions’ segregated accounts.
The reserves are said to be under constant audit and monitoring by independent third parties, assuring investors of the coin’s stability.
Beyond the initial hiccups, the ambition driving the creation of FDUSD is worth noting. The First Digital Group envisages FDUSD to be more than a simple programmable digital asset.
FDUSD is designed to be compatible with Web3 technologies, positioning it to potentially aid in the creation of future solutions. The stablecoin is able to interact with financial smart contracts, escrow services, and insurance protocols without requiring intermediaries. This integration aims to bridge the gap between traditional finance and decentralized technologies in everyday transactions.
Despite Binance’s continuing regulatory challenges, the exchange keeps making headlines for positive developments, such as the listing of the zero-fee stablecoin.
Recently, Binance and its CEO Changpeng Zhao, also known as CZ, revealed plans to dismiss the Commodity Futures Trading Commission’s (CFTC) complaint, according to a court filing.
This move is a reaction to the financial watchdog’s earlier accusation against the crypto exchange for purportedly breaking derivatives market rules in the United States.
Meanwhile, regardless of the few positive developments by the crypto exchange, Binance’s native token BNB has continued to move in a bearish trend. Over the past 24 hours, the native token has plunged 0.3% with a current trading price of $237.7, at the time of writing.
Binance Coin (BNB)’s price is moving sideways on the 4-hour chart. Source: BNB/USDT on TradingView.com
Featured image from Shutterstock, Chart from TradingView
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