Binance has taken a significant step by converting its entire pool of assets held in the user emergency fund into USDC (USD Coin), a stablecoin issued by Circle Internet Financial. The exchange’s Secure Asset Fund for Users (SAFU), initially established in 2018 to safeguard customers during extreme situations, will now solely consist of USDC.
Previously, the fund contained a mix of assets like TUSD, BNB, Bitcoin, and Tether’s USDT. The move comes as part of the company’s new strategy under CEO Richard Teng, who succeeded Changpeng “CZ” Zhao after a plea deal with US agencies in November 2023, resulting in a substantial fine of $4.3 billion. Under Teng’s leadership, Binance has spun off its venture capital unit and tightened token listing requirements.
While the SAFU fund typically maintains a value of about $1 billion, it has fluctuated in response to market movements in the past. By converting to USDC, Binance aims to ensure stability and reliability for the fund, keeping it at the $1 billion mark. This decision also enhances transparency, as the fund’s value can be tracked in real time through a publicly available blockchain address.
Chris Holland, a partner at HM, a compliance consultancy firm in Singapore, commended the move, noting that the “100% USDC composition provides certainty to the value of the fund in US dollar terms.” By leveraging the stability of USDC, Binance seeks to bolster its emergency fund and instill greater confidence in its users.
Additionally, Binance recently appointed a board of directors for the first time to reshape its image following last year’s guilty plea to US charges of anti-money laundering and sanctions violations. Gabriel Abed, former Barbados ambassador to the United Arab Emirates, serves as the chairman, while the board includes CEO Richard Teng and other company executives, along with outside members.
Establishing a board marks a significant shift for Binance, which previously operated without a headquarters. The company’s plea deal and guilty plea by founder Changpeng Zhao underscore its commitment to compliance.
