Binance, the world’s dominant cryptocurrency exchange, has reinvested the entire balance of its user emergency fund, dubbed the Secure Asset Fund for Users (SAFU), into Circle Internet Financial’s stablecoin, USDC. The shift was made to enhance the fund’s reliability, according to Binance.
SAFU was founded in 2018 by Binance as a financial safety net for its users during unfavourable conditions. The Binance announcement stated that the company is now shifting all of SAFU’s assets into USDC. Before this, the fund was a diverse blend of cryptocurrencies, including TUSD, BNB, Bitcoin, and USDT, as outlined in a Binance Academy post.
The transition to USDC, which is modelled to retain a value equitable with the US dollar, marks the most recent in a series of strategic alterations steered by Binance’s CEO Richard Teng in the past five months. Teng assumed leadership of Binance after Changpeng “CZ” Zhao resulted in a massive $4.3 billion fine through a plea agreement with US agencies in November 2023.
SAFU, which typically maintains a balance of around $1 billion, has historically been subject to market fluctuations. This significant move to USDC is designed to guarantee the constant value and trustworthiness of the fund. Binance stresses that the USDC-based fund’s value can be tracked in real-time thanks to a publicly available blockchain address.
Chris Holland, a partner at Singapore-based compliance consultancy firm HM, provided his endorsement of the changeover, stating that the shift to a 100% USDC composition ensures the fund’s value in US dollar terms.