TUSD Slides to 3-Year Low as Speculation Mounts Justin Sun is Using it to Cash Out – Crypto News – Crypto News
Connect with us
TUSD Slides to 3-Year Low as Speculation Mounts Justin Sun is Using it to Cash Out TUSD Slides to 3-Year Low as Speculation Mounts Justin Sun is Using it to Cash Out

De-fi

TUSD Slides to 3-Year Low as Speculation Mounts Justin Sun is Using it to Cash Out – Crypto News

Published

2 years ago

on

The stablecoin continues to stave off depegging as its market cap sheds millions consistently.

TrueUSD, the stablecoin issued by Techteryx, is sliding from its $1 peg while its market capitalization drops as speculation swirls that Justin Sun is using it to cash out onto other cryptocurrencies.

TUSD dropped to as low as $0.96 on Jan. 26, the lowest since May. 2021, according to Coingecko. The stablecoin briefly reached $0.99 today, trading for $0.98 currently. TUSD’s market capitalization has consistently dropped since November, shedding $100M in market cap every few days. The stablecoin’s market cap is down 58% to $1.6B from $3.8B in the past three months.

TUSD Market Capitalization

The de-peg began last week amid a wider market sell-off, although TUSD had other factors impacting its price. Activities on Binance’s Launchpool, which according to TrueUSD, were community mining activities that led to arbitrage opportunities, also caused the token to lose its $1 peg. The movements were part of normal market dynamics and liquidity adjustments, said the company’s ‘X’ account.

Troubles surrounding TUSD’s peg with the US Dollar also took place in June 2023, when traders began shorting the stablecoin as crypto custodian Prime Trust began to collapse. Prime Trust shut down withdrawals and deposits for the stablecoin, forcing TUSD’s then-issuer, TrueUSD, to suspend mints on the platform on Jan. 09. On two occasions, the stablecoin dropped below $1, slipping to a low of $0.993 on Jan.10 and 14.

Today’s de-peg also stems from the alleged ties between Tron founder Justin Sun, who has been accused of using it to buy Bitcoin and ETH in large quantities today on Binance.

TrueUSD, formerly known as TrustToken, was relaunched in March 2018 and fully acquired in 2023 by a little-known Asian-based conglomerate, Techteryx. TUSD is a 1:1 USD-backed stablecoin that provides live on-chain attestations.

Justin Sun has been largely associated with TUSD after the crypto entrepreneur minted $800M of the token, or 25% of its total supply, on Tron. He later transferred the funds to two accounts on HTX, formerly known as Huobi, a crypto exchange that Sun controls.

Crypto investor Adam Cochran pointed out that Sun’s exchange, HTX, turned off their proof-of-reserves website this Friday. It remains offline as of writing. Proof of Reserves is a cryptographic method that proves a platform holds the necessary reserves for it to guarantee withdraws, deposits, and general functioning.

Lack of transparency in HTX reserves impacts TUSD because of the alleged shady dealings behind the stablecoin and the platform–along with its founder, Justin Sun and now-detained Binance founder, Changpeng Zhao.

Not only is the concentration of TUSD on Binance and JustLend suspicious, but also the timing of TUSD mints coinciding with large sell-offs from Bitcoin, according to crypto analyst Dylan LeClair.

DeFi AlphaPremium Content

Start for free

Justin Sun, HTX, and True USD did not immediately respond to a request for comment from The Defiant.

Cochran also singled out a disparity in reporting from DefiLlama and HTX’s own audits–although the latter cannot be confirmed. According to Cochran, DefiLlama shows roughly $120M in ETH assets, whereas HTX’s last audit claimed to hold $300M.

A Dune dashboard of HTX’s assets showcases $1.55B in total balances.

Related Topics:
Continue Reading
Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *

Trending