TrueUSD Struggles with $1 Peg Amid Redemption Troubles

• TrueUSD (TUSD) Stablecoin Encounter pegging instability
• Frustrations in TUSD Redemption
• Crypto Trading Firm's Redemption Requests Denied
• Non-responsive Spokespersons for TrueUSD
• Justin Sun's Link to TUSD
• Binance Data Reflects TUSD Inflow
• Stablecoin Redemption Issues
• Decline in TUSD's Circulating Supply

TrueUSD (TUSD) Stablecoin Encounter pegging instability

The TrueUSD (TUSD) Stablecoin has been experiencing inconsistencies with its pegging, dropping as low as 96 cents on early Thursday. It, however, gained some stability, trading at 99 cents. Certain establishments alleged their redemption requests were declined. According to Binance trading data, there was a sell-off of about $303.5 million in TUSD against $129 million in purchases, culminating in a negative net flow of $174.5 million.

Frustrations in TUSD Redemption

Crypto Trading Firm's Redemption Requests Denied

An anonymous leading quantitative crypto trading company voiced its frustration over denied redemption requests. It also expressed concerns about the challenges it faced while trying to redeem TUSD for fiat, following the collapse of crypto custodian Prime Trust.

Non-responsive Spokespersons for TrueUSD

Despite these reports, public relations representatives for TrueUSD did not provide any feedback in response to a request for comment.

Justin Sun's Link to TUSD

Justin Sun, the founder of Tron, has long been associated with TUSD. Reportedly, data from on-chain analysis tool, Arkham Intelligence, revealed that a wallet address tied to Sun transferred over $60 million to the Binance crypto exchange in the past five hours. This action coincides with TUSD's recovery to its intended $1 peg. The wallet also received TUSD withdrawals amounting to $50 million from Binance. The ownership of this wallet to Sun could not be verified independently.

Binance Data Reflects TUSD Inflow

As per Binance data, a value of $1.8 million has flowed into TUSD in the last two hours from the late afternoon, Hong Kong time.

Stablecoin Redemption Issues

The inability of stablecoin holders to redeem their stablecoins for dollars poses a significant concern for stablecoin issuers. This problem often results in diminished confidence in the market and eventually, depegging. For example, during the crypto banking crisis of last spring, Circle's USDC briefly depegged when Silicon Valley Bank collapsed and regulators shut down Signature Bank. At the time, Circle held $3.3 billion of USDC's reserves at SVB, with Signature Bank being a fundamental part of infrastructure for redemptions.

Decline in TUSD's Circulating Supply

Recent data from Glassnode shows that TUSD's circulating supply has decreased from about $2.3 billion at the beginning of the year to $1.9 billion.

Edited by Jonathan Stoker