Binance, the world’s largest cryptocurrency exchange, has clarified that its forthcoming BFUSD asset is not a stablecoin despite its promise of high yields. The clarification comes after widespread speculation and concerns among crypto users who drew parallels to Terraform Lab’s failed algorithmic stablecoin, TerraClassicUSD (USTC).
Binance confirmed on X (formerly Twitter) that BFUSD is actually a reward-bearing margin trading product designed to offer users additional benefits when trading futures contracts. The company emphasized that BFUSD has not yet launched and will provide more details about its features and mechanics in the future.
BFUSD is not yet launched.
To be clear, it is not a stablecoin but a reward-bearing margin asset for futures trading.
We are glad to see the community's interest and will be sharing more details soon including how APY is determined
— Binance Customer Support (@BinanceHelpDesk) November 18, 2024
Binance’s clarification aims to dispel any misconceptions about BFUSD and prevent unnecessary panic or fear among its users.
Binance announces BFUSD, a yield-bearing stablecoin offering 19.55% APY that can also be used as collateral. 🧐 pic.twitter.com/2siqlqBtdK
— Jameson Lopp (@lopp) November 18, 2024
The company remains committed to transparency and providing accurate information to its community.
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