TUSD TrueUSD

Key Use Cases of TrueUSD

TrueUSD is a stablecoin that offers several practical use cases for both businesses and individual users:

Price Stability

• Reliable Store of Value: TrueUSD is pegged to the value of the US dollar, making it a reliable store of value that remains stable even during times of market volatility.
• Stable Transactions: This stability allows users to engage in financial transactions without the risk of sudden price changes, making it ideal for everyday use.

Security

• Distributed Collateral: TrueUSD spreads its collateral across multiple banks and professional trust companies, reducing counterparty risk and ensuring the security of the coin.
• Regular Audits: Monthly to bi-monthly attestations of the held USD reserves provide transparency and assurance that the stablecoin is fully backed.

Efficient Transactions

• TrueUSD Autosweep: This feature allows for trusted and direct transactions between trading partners, reducing validation requirements and resulting in lower gas costs.
• Fast Processing: TrueUSD transactions are fast and secure, making them suitable for a variety of financial operations.

Financial Applications

• Margin Funding: TrueUSD can be used for margin funding at exchanges, providing traders with a stable and reliable source of funds.
• Cryptocurrency Loans: It can also be used for cryptocurrency loans, offering a stable and transparent alternative to other cryptocurrencies.
• Interest-Bearing Accounts: TrueUSD can be used as deposits for interest-bearing accounts, providing users with a stable and secure way to earn interest.

Integration and Adoption

• Binance Ecosystem: TrueUSD is integrated into the Binance ecosystem, increasing its adoption and utility across various financial operations.
• Chainlink's Proof of Reserve: TrueUSD uses Chainlink's Proof of Reserve (PoR) service to provide real-time and programmatically controlled verification of its reserves, enhancing transparency and trustworthiness.

Business Applications

• Cost-Effective: Accepting TrueUSD payments can help businesses reduce costs associated with traditional payment methods.
• Accessibility: TrueUSD is available on multiple chains (TRC20 and ERC20), making it flexible and accessible for businesses to integrate into their payment systems.

Pros of TrueUSD

• Trusted Backing: TrueUSD is backed dollar for dollar by USD, held in partner banks that handle user funds directly. This means users are trusting deposit institutions, such as PrimeTrust, which have banking relationships with major banks like Bank of America.
• Regular Audits: TrueUSD undergoes regular monthly audits of its escrow accounts by entities such as Cohen & Company. This ensures that every circulating TrueUSD is redeemable for USD whenever the user wishes.
• Multi-Network Support: TrueUSD is supported on multiple blockchain networks, including Ethereum, TRON, Avalanche, BNB Smart Chain, as well as parallel networks like Polygon, Arbitrum, and Optimism.
• Transparency: TrustToken provides regular attestations of its reserves, offering users confidence in the stability of TrueUSD.
• Low Transaction Fees: TrueUSD transactions are typically faster and cheaper than traditional payment methods, making them an attractive option for businesses looking to save money on transaction fees.
• Security: TUSD transactions are fast, secure, and irreversible, reducing the risk of fraud and chargebacks for businesses.

Cons of TrueUSD

• Centralization: TrueUSD relies on a centralized entity for reserve management and auditing, which may introduce risks compared to decentralized stablecoins.
• Pegged to USD: TrueUSD’s value is tied to the US dollar, meaning its buying power can fluctuate in tandem with economic conditions in the US.
• KYC and AML Verification: When buying TrueUSD from TrustToken, users need to pass KYC and AML verification, which some in the cryptocurrency community believe compromises anonymity.
• Counterparty Risk: Being built on Ethereum opens up counterparty risk, meaning TrueUSD is vulnerable to anything that Ethereum would be vulnerable to.
• Limited Investment Potential: As with all stablecoins, investing in TrueUSD does not offer the potential for significant gains, as its value is designed to remain stable.

Founders of TrueUSD

The founders of TrueUSD include:

• Jai An: CEO and co-founder, previously worked as the first engineer at Kernel and graduated from the University of Texas at Austin with a Bachelor’s degree in Information Systems.
• Rafael Cosman: Co-founder and Head of Engineering, previously worked as an engineer at Kernel, Google, and was a co-founder of the East Palo Alto non-profit tech hub StreetCode. He graduated from Stanford University with a Bachelor’s degree in Computer Science.
• Tory Reiss: Co-founder and Head of Partnerships and Business Development, graduated from Northwestern University with a degree in Behavioral Economics and Entrepreneurship in Emerging Markets. He worked in sales at Microsoft and later in business development, including a role as a founding sales leader for Lob.
• Stephen Kade: Co-founder with a background in neuroscience and economics.

Investors in TrueUSD

TrueUSD was initially backed by several prominent investors and organizations. These include:

• Stanford StartX: A startup accelerator and fund affiliated with Stanford University.
• Blocktower Capital: A cryptocurrency investment firm.
• Founders Fund Angel: A venture capital firm known for investing in early-stage companies.

These investors supported the creation and development of TrueUSD, which was founded by TrustToken, a team with backgrounds from Stanford, Palantir, Google, and UC Berkeley.

Halal Status of TrueUSD

• Halal Status: No
• Reason: Although TrueUSD was initially designed to be backed by real assets and had mechanisms in place for transparency and security, recent allegations by the SEC suggest that the majority of its assets were not properly backed, leading to significant ethical concerns that conflict with Islamic finance principles.