Following TrustToken’s determination to quickly halt mints and redemptions of its TrueUSD (TUSD) stablecoin by way of its banking associate, Prime Belief, a dealer has taken benefit of the state of affairs by initiating an on-chain short position.
In response to on-chain knowledge, an Ethereum person utilized Aave’s v2 lending platform to deposit 7.5 million USD Coin (USDC) as collateral. They then borrowed 4 million TUSD and promptly bought it for USDC. This technique of borrowing and instantly promoting is ceaselessly employed to determine a short position on a specific asset.
Earlier this month, the TrueUSD workforce introduced the suspension of new TUSD minting by way of its custodial associate, Prime Belief, an organization primarily based in Las Vegas, Nevada. Subsequently, the Monetary Establishments Division of the Nevada Division of Enterprise and Trade issued a cease-and-desist order in opposition to Prime Belief.
In response to the Prime Belief state of affairs, the TrueUSD issuer clarified that it doesn’t have an effect on its operations regarding the conversion of fiat to stablecoin and vice versa. Via an announcement, the issuer affirmed that it has no publicity to Prime Belief and maintains a number of United States greenback rails for the minting and redemption of TrueUSD, as stated in a tweet.
The pockets infrastructure supplier and digital asset custodian BitGo beforehand signed a non-binding letter of intent to amass Prime Belief, in response to an announcement on June 8. Nonetheless, On June 22, BitGo introduced on Twitter that it had decided to cancel its acquisition of Prime Belief.
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Following legal action by the New York Division of Monetary Providers and the U.S. Securities and Exchange Commission against the Binance-branded Binance USD (BUSD) stablecoin and its issuer, Paxos Belief, Binance changed its BUSD holdings with TUSD, which led to a big improve in its utilization and recognition.
TUSD is the fifth-largest stablecoin after Tether (USDT), USDC, Dai (DAI) and BUSD, with a market capitalization of simply over $3.1 billion, according to CoinGecko.
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