Binance, the world’s largest Bitcoin (BTC) and cryptocurrency exchange, is increasing security for its users by fully converting its User Safe Asset Fund (SAFU) to Bitcoin.
The company will convert $1 billion currently held in USDC addresses to BTC. This decision aims to strengthen customer protection. The platform is in the midst of an acquisition process that is expected to be completed within the next 30 days..
“Based on our belief that BTC is a core asset in the ecosystem and represents long-term value, Binance will continue to invest alongside our industry through market cycles and uncertainties,” the company reported today, January 30th.
The SAFU Fund acts as an emergency insurance, established in 2018 to protect the interests of users in extreme cases such as security breaches. Until 2024, this capital was distributed in BTC, BNB, and USDC. However, the company transferred its entire funds to a stablecoin. The new policy now focuses this support on Bitcoin. Binance explains that it “periodically rebalances the balance of the SAFU Fund based on market value monitoring.”
This active management involves continuously monitoring Bitcoin’s volatility. For example, if the fund’s market value falls below $800 million due to Bitcoin price fluctuations, Binance plans to rebalance to bring value back to $1 billion.
Responding to market uncertainty
The conversion of these funds takes place in the context of FUD (Fear, Uncertainty and Doubt) directed at the platform and its founder Changpeng Zhao. These criticisms arose after operational issues recorded on October 10, when Binance faced technical failures that prevented order execution and delayed withdrawals during periods of high volatility, as reported by CriptoNoticias.
In response to the allegations, Zhao Changpeng remained defensive, claiming that the baseless attacks against the company are having a negative organizational impact. The former manager said that the spread of misinformation is not limited to Binance. This will ultimately undermine the stability of the entire digital asset market and the trust of participants..
“Binance only converts a portion of their income to cover expenses. They are big online hoarders. Binance also now has a global regulator that can review every transaction on every account. Don’t get me wrong. “Please use your energy to improve the situation,” the company’s founder said, denying rumors that customers’ assets are poorly managed.
Bitcoin price outlook
Executing a $1 billion purchase on the open market means significant demand pressure. this movement This could trigger a rise in the price of digital currencies.which fell to the $90,000 to $83,000 area last week.
The entry of such a large amount of institutional capital, intended to be held in reserve rather than immediately traded, reduces the circulating supply of Bitcoin.
If Binance meets its 30-day timeline to complete the conversion, the market could see solid support stemming from these planned acquisitions. Solidifying the narrative that Bitcoin is the reserve asset of choice Due to the large financial infrastructure of this sector.
(Tag Translation) Binance
