Bottom line: BUSD has been completely phased out of the Binance ecosystem in 2024 (Paxos stopped issuing it). The main stablecoin choices now are USDT, USDC, and FDUSD. When it comes to Earn yields, USDT usually offers the highest rates (Flexible 2-5%, Locked 5-12%), followed by FDUSD, with USDC generally offering the lowest. If you need to log in to configure your Earn products, access the Binance Official Website; Android users can use the Binance Official APP, and Apple users can follow the iOS installation guide.
Many veteran users still ask about BUSD. This article will first clarify what happened to BUSD, then compare the yields of the current mainstream stablecoins.
What Happened to BUSD?
BUSD was a stablecoin issued in partnership between Binance and Paxos. From 2019 to 2023, it was the flagship stablecoin of the Binance ecosystem. However:
- In February 2023, the New York Department of Financial Services (NYDFS) ordered Paxos to stop minting new BUSD.
- In March 2023, Binance announced the gradual phase-out of BUSD.
- By early 2024, BUSD trading pairs were completely removed from Binance.
- Existing BUSD can still be redeemed for USD (through Paxos).
Therefore, you should no longer consider using BUSD—you cannot trade with it or earn yield on it.
Current Mainstream Stablecoins
The active stablecoins in the Binance ecosystem today are:
| Stablecoin | Issuer | Peg | Market Cap | Regulated In |
|---|---|---|---|---|
| USDT | Tether | USD | $100B+ | Hong Kong / El Salvador |
| USDC | Circle | USD | $30B+ | USA |
| FDUSD | First Digital | USD | $3B+ | Hong Kong |
| TUSD | TrustToken | USD | $1B+ | USA |
| DAI | MakerDAO | USD (Decentralized) | $5B+ | On-Chain Protocol |
Binance primarily promotes three: USDT, USDC, and FDUSD.
Yield Comparison of the Top 3 Stablecoins
Flexible Earn (Estimated Real-Time APR)
| Coin | Current APR Range |
|---|---|
| USDT | 2-5% |
| USDC | 1.8-4% |
| FDUSD | 1-3% |
USDT offers the highest yield because borrowing demand is the highest. The vast majority of Binance Margin and Futures users use USDT as collateral. Since the market demand to borrow USDT is consistently high, the interest paid to lenders is also high.
Locked Earn (Estimated Real-Time APR)
| Coin | 30 Days | 60 Days | 90 Days | 180 Days |
|---|---|---|---|---|
| USDT | 5-8% | 6-10% | 7-12% | 8-15% |
| USDC | 4-6% | 5-8% | 6-10% | 7-12% |
| FDUSD | 3-5% | 4-7% | 5-8% | 6-10% |
In locked products, USDT also leads the pack, while FDUSD is the lowest. However, FDUSD has a unique advantage: FDUSD Launchpool mining. You can stake FDUSD to farm new tokens for free.
Crypto Loans Market
If you need to lend out stablecoins (by pledging BTC or ETH as collateral):
- Lending USDT: 5-12% APR
- Lending USDC: 4-10% APR
- Lending FDUSD: 3-8% APR
Why is there such a big difference in yields?
Factor 1: Circulating Supply
USDT is the stablecoin with the largest circulating supply (over $100 billion), meaning it has the deepest lending market. When demand heavily outstrips supply, interest rates rise.
Factor 2: Risk Premium
USDT has historically faced controversy over whether its reserves are fully backed (despite Tether publishing multiple audits). As a result, the market demands a risk premium. USDC, issued by Circle, has higher transparency regarding its cash + US Treasury reserves, resulting in a lower risk premium.
Factor 3: Trading Pair Depth
Mainstream coins paired with USDT have the deepest liquidity (BTC/USDT, ETH/USDT). Many users are reluctant to swap to other stablecoins, concentrating the lending demand squarely on USDT.
Factor 4: Regulatory Impact
USDC is strictly regulated in the US, causing some high-risk users to avoid it (e.g., funds looking to evade sanctions). USDT, conversely, captures demand from the "gray market", which impacts its price and interest rates.
Which Coin Should You Choose?
Reasons to Choose USDT
- Highest yields.
- Best liquidity.
- Compatible with all trading pairs.
- Highly versatile across different platforms.
Reasons to Choose USDC
- Most strictly regulated, favored by institutional users.
- Transparent reserve assets.
- Lowest risk of de-pegging.
- Best for long-term safe haven holding.
Reasons to Choose FDUSD
- Can be used in Binance Launchpool to farm new tokens.
- Heavily supported by Binance.
- Relatively stable yields.
Practical Allocation Advice: 70% USDT + 20% USDC + 10% FDUSD is a common and balanced portfolio.
The Risk of De-Pegging
Although they are called "stablecoins", they do occasionally lose their peg:
| Historical De-Peg Events | Date | Lowest Price | Time to Recover |
|---|---|---|---|
| USDT De-peg | May 2022 | 0.95 USDT | 2-3 Weeks |
| USDC De-peg | Mar 2023 | 0.87 USDC | 1 Week |
| BUSD De-peg | Feb 2023 | 0.99 BUSD | A few days |
| TUSD De-peg | Jan 2024 | 0.97 TUSD | A few days |
| FDUSD De-peg | May 2024 | 0.85 FDUSD | 1 Week |
De-pegging means 1 USDT isn't necessarily worth 1 USD. It has dropped as low as $0.85 before. Therefore, parking massive amounts of capital solely in stablecoins is not completely risk-free.
Defensive Strategy:
- Never put all your funds into a single stablecoin.
- Diversify across 2-3 different stablecoins.
- Do not leave all your funds on an exchange (de-pegging events are often tied to exchange risks).
Choosing the Right Network for Withdrawals
Different stablecoins support different blockchains. Choosing the wrong network can result in lost funds:
| Stablecoin | Supported Networks | Recommended | Transfer Fee |
|---|---|---|---|
| USDT | TRC-20 / ERC-20 / BEP-20 / OPT / ARB | TRC-20 | 1 USDT |
| USDC | ERC-20 / BEP-20 / SOL / OPT / ARB | OPT or ARB | 1-3 USDC |
| FDUSD | BEP-20 / ETH | BEP-20 | 0.3 USDC |
TRC-20 is the premier choice for USDT transfers because it has the lowest fees and fastest arrival times. However, you must ensure the receiving wallet or exchange also supports TRC-20.
FAQ
Q: Are stablecoins truly stable?
Theoretically yes (pegged 1:1 to the US Dollar), but in reality, they experience minor fluctuations (±0.5-2%). Extreme events cause de-pegging, so you cannot treat them 100% like real fiat USD.
Q: Could USDT go to zero?
In the short term, this is highly unlikely, as Tether holds massive reserve assets. But over the long term (5-10 years), there is regulatory uncertainty. We recommend not keeping all your net worth in USDT.
Q: Is USDC safer than USDT?
From a regulatory standpoint, USDC is more compliant. However, its March 2023 de-peg (dropping to 0.87) proved it carries risks too—at the time, the collapse of Silicon Valley Bank froze part of USDC's reserves. Therefore, "safe" is relative.
Q: Can I use FDUSD exclusively?
Theoretically yes, but FDUSD has much worse liquidity than USDT. Many small altcoin pairs don't even have an FDUSD trading pair. For daily trading, you will still need USDT.
Q: Is there a "safest" stablecoin?
There is no absolutely safe choice. Holding 2-3 different stablecoins is the safest strategy to mitigate single-coin black swan events.
Q: Can stablecoins be transferred directly between platforms?
Yes. USDT and USDC are universally accepted across all major exchanges. FDUSD is primarily used within the Binance ecosystem, and support on other exchanges is limited.
Q: Is there a fee to swap one stablecoin for another?
Internal stablecoin swaps on Binance (e.g., USDT → USDC) carry a tiny 0.01-0.05% fee, which is virtually negligible. Do not sell one for fiat and buy the other—you will end up paying the standard 0.1% spot trading fee twice.
Q: Can I convert USDT into my local fiat currency?
Yes. You can use Binance P2P (C2C) to sell USDT to buyers in exchange for your local currency transferred to your bank account. Keep in mind local banking regulations and potential account freeze risks depending on your country.
Summary
BUSD has been retired. The current mainstream stablecoins on Binance are USDT, USDC, and FDUSD. When it comes to Earn yields, USDT reigns supreme (Flexible 2-5%, Locked 5-12%). USDC offers slightly less but boasts stricter regulatory compliance, while FDUSD has lower base yields but allows you to participate in Launchpool farming. We recommend a diversified portfolio: 70% USDT + 20% USDC + 10% FDUSD. Stablecoins are not perfectly stable and have historically de-pegged to the 0.85-0.95 range. Spreading large capital across multiple stablecoins and multiple platforms remains the most secure strategy.