Not too long ago, the Securities and Change Fee (SEC) settled with TrustToken and TrueCoin, earlier operators of TrueUSD (TUSD), over allegations that the companies despatched the backing for the stablecoin to “a speculative and risky offshore commodity fund.”
The fund, which invested in “trade finance, structured trade, export finance, import finance, supply chain financing, and project financing of entities,” gave the impression to be supplied by First Digital Belief in Hong Kong. Allegedly, “more than 99% of the assets backing TUSD” had been positioned within the speculative fund.
Moreover, the grievance alleges that in 2022, TrueCoin and TrustToken had been conscious of redemption points at this fund.
Importantly, this settlement didn’t embody Techteryx, the agency that now owns TrueUSD. This agency has repeatedly denied that it’s underneath the management of Justin Solar, described as an “Asia markets advisor” for TrueUSD, although the previous chief govt of TrustLabs has claimed that Solar tried to accumulate the agency.
A evaluate of an attestation for TrueUSD reveals that roughly 99.7% of the reserves for this stablecoin are nonetheless held at First Digital Belief, regardless of the allegations within the earlier SEC settlement.
The attestation additional notes that Moore Hong Kong, the agency behind it, valued investments in that fund “at cost” and makes certain to notice that its “procedures do not include an examination over the fair market value of the investments within the Fund.”
Which means even when the honest worth of property in that fund had fallen to zero, this attestation would proceed to report the worth at price invested.
Moreover, the notes from Techteryx administration signed by Jennifer Jiang (additionally of Solar-affiliated BiT International, Solar-owned Poloniex, Solar-advised HTX, and Solar-owned BitTorrent), additionally state that these property “may not be readily convertible to cash, subject to market conditions or fund performance.”
At present, the reserves for the roughly $495 million in TUSD are made up of roughly $502 million held at First Digital and roughly $1 million in money.
Protos has reached out to TrueUSD to find out which fund it’s at the moment invested in, but it surely didn’t instantly reply.
