Just weeks after the appearance of a new dollar-pegged coin, the TrueUSD (TUSD), a new trading pair was set, against Tether (USDT).
Now, there is a direct channel from Tethers into TrueUSD, which reports its dollar backing in a more transparent fashion. The only problem is there are only around 7.9 million TUSD tokens, while there are more than 2.2 billion Tethers in circulation. It is unclear whether the inflow of Tethers would cause the price of TUSD to fluctuate. Investors have been urged not to buy in case the price goes too far above the range.
“We believe that TUSD is the best option for traders and funds who don’t want the risk of Tether but still want to hold crypto assets in a price-stable token,” said Rafael Cosman, CTO of TrustToken, the company behind TrueUSD.
Until now, in theory, users could buy TUSD with Bitcoin, or sell to TUSD in case they wanted to have a fiat equivalent.
Bitcoin itself has been volatile, sliding under $7,000 for the first time in about four months, and Tether trading has seen an uptick. USDT pairings took up more than 15% of total market volumes, with a growing trend in the past weeks. USDT is often used to sell for stability at times of BTC fluctuation.
However, Tethers have received questioning regarding a conversion back to fiat. As for TrueUSD, reversal to fiat only follows a KYC procedure, and so far no user reports have surfaced to verify the system. TrueUSD reports the dollar backing via a monthly report.
At the moment, TrustToken is applying for a license to serve as a Money Service Business, one more step to ensuring the TUSD asset is backed by actual dollars.
The fully legalized status of the enterprise is still in waiting, but may be announced soon. Still, with a limited supply, TUSD is a long way from adoption in place of Tethers. But if successful, TrustToken may be fully compliant with US regulations.
At the same time, the crypto community remains skeptical of the project:
TrueCoin LLC does not have a MSB license and is not registered with FinCen. Even Tether had this. Lol $tusd
— I am Nomad (@IamNomad) March 6, 2018
Some users are seeing too many parallels with Tethers, where the tokens themselves came with an explicit warning they are not securities or money. New issues of TrueUSD would be closely monitored, in case the supply grows by unexplained leaps.g
This article appeared first on Cryptovest
