- TUSD’s fast rise has attracted scrutiny.
- The stablecoin has continuously been linked with Tron’s Justin Sun.
- The stablecoin issuer has vehemently denied these claims, threatening one detractor with legal action.
TrueUSD (TUSD) has risen from relative obscurity to become the fifth-largest stablecoin by market cap, thanks to growing support from Binance, the world’s largest crypto exchange by 24-hour trading volume.
TUSD’s newfound notoriety has unsurprisingly attracted scrutiny. With its ownership opaque, some openly speculate that the stablecoin is owned by Tron founder Justin Sun. TrueUSD has not taken kindly to these speculations, recently threatening one such detractor with a defamation lawsuit while forcefully rejecting being owned by Sun.
‘TrueUSD Was Never Owned by Justin Sun’
On Wednesday, May 3, TrueUSD threatened to slap Cinneamhain Ventures Partner Adam Cochran with a defamation lawsuit.
In a tweet on the same day, Cochran had asserted that Justin Sun owned the stablecoin and now controlled the private keys to its wallets. The VC partner made this claim while responding to reports that TUSD had handed over its private keys to Techteryx, a mysterious “Asia-based consortium” that acquired TrueUSD in December 2020.
Cochran further suggested that the dollar backing of the stablecoin remained unclear. His statements, however, did not sit well with TrueUSD.
"TrueUSD was never owned by Justin Sun and it's a despicable act to smear TUSD's real-time Proof of Reserve in collaboration with our audit firm and Chainlink, as well as banking partners," TrueUSD asserted, adding, "We reserve our right to pursue legal remedies against your defamation."
But TrueUSD’s threat of legal action failed to achieve the desired result, as Cochran pressed on with his claim.
Cochran Fires Back at TrueUSD
The Cinneamhain Ventures partner questioned why there is no record of Techteryx on Singapore’s database while highlighting that all parties involved would be open to discovery in a defamation lawsuit. He further compared TrueUSD’s situation with Poloniex, an exchange heavily linked with the Tron founder, also purchased by an “Asia-based consortium.”
Cochran challenged the stablecoin issuer to prove him wrong by being open about their corporate structure.
"If that's not the case, it's really easy for you to be transparent on your operating structure - which should be in the interest of a trusted and transparent stablecoin, and something that TrustToken did really well under Archblock initially. It's also daft to threaten legal action for people questioning you - doesn't really build any of the 'trust' you're looking for," Cochran argued.
On the Flipside
- In a Bloomberg Interview on April 26, Sun admitted to helping with TUSD’s growth but denied having shares in TrueUSD or any ties to Techteryx.
- The Tron founder recently described Tron DAO Venture as a “partner market maker” for TUSD.
- TUSD offers an off-chain proof-of-reserve with the help of Chainlink, but the data is based on a third-party attestation by The Network Firm, a little-known accounting firm.
Why You Should Care
TUSD is a Fiat-backed dollar stablecoin that maintains its peg by holding equivalent reserves in the fiat currency. Concerns over the stablecoin’s reserves can cause it to lose its peg.
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