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Binance to Cut USDC Support: What To Do if You Have Tron-Based Coins

Last Updated March 25, 2024 12:55 PM
Teuta Franjkovic
Last Updated March 25, 2024 12:55 PM

Key Takeaways

  • Binance is cutting USDC support on Tron.
  • The crypto industry is focusing on risk management.
  • TRON’s future looks a little more uncertain.

Binance has announced  it will cease support for USDC, a leading dollar-pegged stablecoin, for deposits and withdrawals on the Tron blockchain starting April 5.

Following 2:00 a.m. UTC on the specified date, deposits of TRC20 USDC tokens will not be credited to users’ accounts, as detailed in an official statement on the crypto exchange’s blog .

Domino Effect: After Circle, Binance Cuts USDC Support on Tron

Binance’s move to end support for USDC on the Tron blockchain reflects a similar step taken by Circle. Circle decided to stop issuing USDC tokens on the Tron blockchain due to concerns about the blockchain’s integrity and previous accusations of fraud related to TRX, Tron’s native token.

This decision by Binance, following Circle’s lead, indicates a possible industry trend where worries about the reliability of specific blockchain networks lead significant entities to reconsider their engagement.

Circle, a leading global stablecoin issuer, previously declared its plan  to phase out support for the USDC stablecoin on the Tron blockchain. This decision aligns with Circle’s comprehensive approach to risk management, aimed at maintaining the trust, transparency, and security of USDC amid concerns about Tron’s integrity and past accusations of market manipulation.

This action underscores the importance of diligent risk evaluation and regulatory compliance in the cryptocurrency sector. Despite withdrawing USDC support on the Tron network, Circle remains dedicated to broadening USDC’s reach across various blockchain environments.

Tron did not immediately respond to a request for comment.

Sparking Crypto Speculation About Stablecoin’s Future

Likewise, Binance has assured its users  that USDC trading will continue, and that deposits and withdrawals of USDC through other supported networks will remain unaffected.

Binance’s move to end USDC transactions on the Tron network is indicative of a wider trend in the cryptocurrency industry, where exchanges and companies are placing a greater emphasis on risk management and regulatory compliance.

This shift is in response to changing market conditions and the evolving regulatory landscape.

Despite Binance’s reassurance that USDC trading on its platform will continue without interruption, the decision has broader implications. It raises questions about the future of USDC and its availability across different blockchain networks, sparking speculation within the cryptocurrency community about what might come next.

Tron’s Woes: Lawsuit, USDC Exit, & Terror Link

Justin Sun, the founder of Tron and a well-known figure in the cryptocurrency world, faced legal action  from the U.S. Securities and Exchange Commission (SEC) last year. The SEC accused him of artificially boosting trading volumes and selling Tron tokens without the necessary securities registration, and Sun has dismissed the charges as baseless.

USDC, with approximately $32.1 billion in circulation , ranks as the eighth-largest cryptocurrency and the second-largest stablecoin, trailing only Tether. The majority of USDC is based on the Ethereum blockchain, as Circle stated. Before Circle discontinued support for USDC on the Tron blockchain in February, there was about $335 million of USDC on Tron.

As previously reported by CCN, which included insights from financial crime experts and blockchain investigation specialists, highlighted that Tron had surpassed Bitcoin as the preferred platform for crypto transactions linked to entities designated as terrorist organizations by Israel, the United States, and other nations.


Band-Aid? Tron Eyes Bitcoin Layer-2 Solution with Tether

Crypto users on Binance have been given a 12-day window to convert, transfer, or withdraw their TRC-20 USDC tokens from the platform, although Binance will still support USDC trading after this period. In an interesting development, the layer-1 blockchain Tron is exploring a Bitcoin layer-2 solution that could accommodate a “wrapped” version of Tether (USDT), potentially enabling a significant influx of liquidity into the Bitcoin ecosystem.

In February, Tron’s founder Justin Sun, unveiled  a roadmap for Tron’s Bitcoin layer-2 solution on an X post, aiming to enable the transfer of stablecoins and tokens between Tron and Bitcoin. Sun highlighted  the potential benefits of this integration, emphasizing that it would not only connect TRON directly to Bitcoin but also open up access to over $55 billion in value to the Bitcoin network, thereby enhancing Bitcoin’s financial dynamics.

Sun stated that a Bitcoin layer-2 solution would enable tokens on the Tron blockchain to interact and interoperate with Bitcoin “seamlessly,” facilitating a smooth and integrated experience between the two platforms.

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