TrueUSD is a USD-backed ERC20 stablecoin with complete collateralization, legal protection, and transparent third-party proof. To mitigate counterparty risk and give token holders with legal protection against misuse, TrueUSD employs several escrow accounts. The first asset token produced on the TrustToken platform is TrueUSD.
What is Stablecoin?
Stablecoins are digital currencies that are linked to less volatile external assets such as fiat currencies, precious metals, or oil. A stablecoin’s supply or value can also be tied to other crypto assets or set by algorithms. Instead of experiencing huge price swings, stablecoins maintain the same value as their underlying asset. The primary concept behind stablecoins is to maintain a constant value throughout time.
In the crypto ecosystem, stablecoins are quite important. They make it possible for more individuals to make use of the blockchain’s benefits without having to worry about price fluctuations. They also provide a stable environment for traders, investors, suppliers, and other parties looking to store their profits or assets.
Technically, supporting the currency with less volatile traditional assets like USD or Gold makes it more stable, making it a safer option for all participants in the crypto ecosystem.
Tether is one of the most well-known instances of a stablecoin (USDT). When USDT tokens are issued, an equivalent amount of USD is placed into a bank account that has been audited. Tether also provides a platform that allows users to deposit and withdraw real dollars. The circulating supply of USDT tokens drops or rises in proportion to the amount of money in a bank account.
Since its launch in 2014, Tether has been the most trusted stablecoin. However, the stablecoin has been dogged by accusations of fractional reserve banking throughout the last year. The corporation failed to present any serious proof in support of the allegations, leading to rising skepticism about the initiative.
Simultaneously, the circumstance has created an opening for a new generation of stablecoins to hold themselves to a higher standard. TrueUSD is one of these projects.
What is TrueUSD (TUSD)?
TrueUSD, also known as TUSD, is a stablecoin that is tied to the US dollar at a 1:1 ratio. In January 2018, it was first made available to a selected group of investors.
TrustToken, a platform for tokenizing real-world assets, manages a number of cryptocurrency stablecoins, including TrueUSD.
TrueUSD, like other stablecoins, strives to boost liquidity and provide a nonvolatile asset to cryptocurrency traders and ordinary consumers in comparison to free-floating tokens like Bitcoin (BTC).
TrueUSD was made for traders and exchanges, Mainstream commerce, developing economies, long-term financial contracts, and Financial institutions.
TrueUSD is an excellent instrument for hedging against market volatility and entering markets without first purchasing BTC or ETH. People and companies may benefit from the advantages of blockchain technology without being exposed to significant price changes. Stable currencies can be used for trading in emerging markets. Loans, wages, and prediction markets are examples of long-term financial contracts. To trade in the crypto markets, financial institutions might employ a reliable asset.
TrueUSD: roots and history
TrueUSD is a stablecoin created by TrustToken, the parent business of TrueUSD. Rafael Cosman is the co-founder and CEO of TrustToken.
Cosman has had a lifetime interest in encryption, having studied it alongside artificial intelligence (AI) before working at Google Brain and Palantir, a software business. In 2017, he left Google to start TrustToken.
TrueUSD, according to Cosman, was always only the beginning of TrustToken’s product range, requiring little effort in exchange for a high-impact asset.
He stated at the time of launch that frequent audits of the stablecoin were a top priority for the firm, providing investors with peace of mind at a time when many crypto assets were experiencing high volatility as a result of the ICO phenomena.
How does TrueUSD work?
To keep themselves from issuing tokens, TrustToken uses publicly audited smart contracts. The money is never touched by the TrustToken staff. When an escrow account gets USD, a new TUSD is instantly created. When a user redeems USD, an equal quantity of TUSD is immediately burnt. As a result, TrustToken assures a 1:1 USD to TUSD ratio between escrow funds and TUSD in circulation.
When users complete the KYC/AML process, they can transmit USD to one of TrueUSD’s trust partners (along with Ethereum wallet address). The API then interacts with TrueUSD’s smart contract, which issues tokens in a 1:1 ratio and delivers them to the supplied wallet once the funds have been validated by the escrow business.
When the tokens arrive in your wallet, you may spend them on whatever you choose. TrueUSD tokens combine the best of both worlds: fiat stability and confidence, as well as for cryptocurrencies’ cheap costs, short transfer times, and worldwide reach.
Why choose TrueUSD?
TrueUSD strives to strike a balance between stability and usefulness, which are the two major use cases for stablecoins, and security, which comes in the form of periodical attestations.
TrustToken, the stablecoin’s parent firm, has emphasized the significance of independent verification of the stablecoin’s origin since its introduction. As a result, the stablecoin’s appeal is oriented towards both major investors and smaller individual traders wanting to decrease risk.
TUSD is the first regulated stablecoin completely backed by the US Dollar.
TrueUSD is part of a growing stablecoin ecosystem that currently comprises a whole slew of dollar-backed products.
As part of its business activities, TrustToken has formed several corporate relationships, including opportunities for TUSD holders to improve yearly passive income yields.