On September 19, WazirX, one of India’s leading cryptocurrency exchanges, announced the delisting of Circle’s USDC, Paxos’ USDP, and TrueUSD (TUSD) stablecoins, effective September 26, following in Binance’s footsteps.
According to the statement, USDC, USDP, and TUSD deposits have already been suspended. In addition, users will have to withdraw their funds by October 05, or they will be automatically converted to BUSD —just like Binance did.
“Auto-conversion will be done on or before October 05. After the Auto-Conversion is completed, users will be able to withdraw USDC, USDP, or TUSD at a ratio of 1:1 from their BUSD balances.”
Tether’s USDT will still be supported.
WazirX’s Goal Is “To Enhance Liquidity And Capital Efficiency”
According to WazirX, the delisting of USDC, USDP, and TUSD, seeks to enhance liquidity and capital efficiency for users, a claim identical to what Binance made recently when it delisted the same stablecoins.
Like Binance, WazirX ended its statement by indicating that it could include other significant stablecoins. However, the exchange did not provide further information in this regard.
The relationship between Binance and WazirX is tricky. On its official site, WazirX claims it is affiliated with the Binance group, so the decision could be in line with Binance’s interests to make BUSD one of the most important stablecoins in the ecosystem, increasing its market capitalization, which is currently around $20.52B.
However, as CryptoPotato recently reported, Binance CEO Changpeng Zhao (CZ) recently said on Twitter that his exchange had not “acquired” WazirX due to payment issues, so the delisting decision (at least in theory) should have nothing to do with his company’s interests, even though Binance offers wallet services to WazirX, as well as off-chain transaction solutions to help users save money on network fees.
Is USDC Losing The Favor of The Big Players?
Circle Internet Financial’s USDC stablecoin is one of the biggest competitors to BUSD, Binance’s stablecoin. It currently has a market capitalization of nearly $50 billion, well below the $67 billion held by Tether (USDT).
Although Jeremy Allaire, CEO, and co-founder of Circle, has recently said that the actions taken by Binance were not harmful to USDC, the truth is that other significant investors and projects, such as MakerDAO, creator of the DAI stablecoin, are considering delisting from USDC.
This action against USDC is taking place a few weeks after the US Treasury Department sanctioned cryptocurrency mixer Tornado Cash, causing Circle to automatically block USDC 75,000 belonging to several “unsuspecting” Tornado Cash users, as reported by developer Banteg.
Circle just frozen 75,000 USDC belonging to unsuspecting Tornado users, as well as 149 USDC donated to the project. pic.twitter.com/GBS41FtZvB
— banteg (@bantg) August 8, 2022
WazirX’s native token WRX showed no major reaction to the news. It has been trading sideways since June, fluctuating between $0.18 and $0.24, with some exceptional peaks along the way.