Binance, a leading cryptocurrency exchange, has announced the conversion of its emergency insurance fund, known as the Secure Asset Fund for Users (SAFU), into Circle’s USDC stablecoin. This decision aims to enhance the reliability of the fund and ensure its balance remains stable around the $1 billion mark.
In a statement released on Wednesday, Binance emphasized that SAFU remains a core component of its responsibility to the ecosystem, and the decision to convert it entirely into USDC reflects the exchange’s commitment to evolving to meet market conditions.
According to on-chain data, the wallet address associated with Binance’s SAFU fund converted $738 million worth of Binance Coin (BNB) into $800 million USDC. Simultaneously, the Bitcoin address linked to the SAFU fund transferred out $1 billion worth of bitcoin (BTC), while $1 billion worth of USDC was added to the Ethereum wallet associated with the fund.
The bitcoin transferred out of the SAFU fund is now held in one of Binance’s exchange hot wallets, as indicated by blockchain transaction data from OXT.
Market participants have speculated that these high-value transfers may have contributed to recent volatility in the price of bitcoin. However, pseudonymous crypto trader Wagmi on X suggested that the trade has likely concluded and should no longer impact market dynamics.
“Looks to me that the trade already occurred and drove extreme market weakness over the last few days and it should be behind us. The flows today are to settle the trade,” Wagmi stated.