Cons & Pros of TrueUSD Crypto

By Kapil Gauhar

A stablecoin is a cryptocurrency meant to be pegged to a stable asset, just like Gold or other fiat currency.

TrueUSD (TUSD) crypto is a popular stablecoin which is a part of TrustToken asset tokenization platform. Comparatively, it seems to have risen from its possible limitations.

TUSD is an ERC20 token which hopes to allow people as well as institutions to enjoy many of their advantages using cryptocurrencies with the risk.

You may also read: How to Buy Bitcoin With Cash?

What Is So Special About TrueUSD?

Each TrueUSD token is backed up 1 to 1 with real US dollars. Though, TrustToken doesn’t really hold any USD reserves themselves. Rather, they have partnered with lawfully registered banks as well as fiduciary institutions holding the dollars in escrow.

Any individual or organization, which can pass a KYC or AML check, can open an account with TrustToken and get TrueUSD for the first time just by visiting their website.

You wire USD to one of TrustToken’s third-party partners, and then offer them with your Ethereum wallet address.

When done, TrustToken starts a TrueUSD smart contract, whereby the equivalent amount of TrueUSD is not just minted but delivered to your wallet.

To redeem TrueUSD tokens, you need to send them back to the TrustToken, that activates a blockchain smart contract which will burn the amount of tokens that you wish to exchange.

That way, there is always an exact 1-to-1 correlation with the number of TrueUSD tokens in circulation and the amount of USD held in escrow.

You may also read: 10 Differences Between Ethereum And Ethereum Classic

That Sounds Great, Doesn’t It?

Everything so far seems fine, but everything has its own pros and cons, so as TrueUSD. Let’s discuss them.

Pros of TrueUSD

  1. USD funds are verified by a trusted auditing firm.
  2. TrustToken doesn’t have any direct access to the USD holdings, even if they want to.
  3. Token minting and burning system makes sure that every single TUSD token is backed up by 1 USD.
  4. As an ERC20 token, TUSD can be stored in Ethereum Wallet.
  5. Mandatory KYC/AML compliance makes sure that TUSD keeps shady characters away from tainting the project.

Cons of TrueUSD

  • TrueUSD is an incredible tool for a cryptocurrency trader. Since it got listed on Faast, it’s never been that easy to add to your portfolio.

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Kapil Gauhar

Kapil Gauhar is the founder of Blogger’s Gyan. He is a Passionate Blogger, a Big Thinker and a Creative Writer. His passion for doing friendship with words and letting people know about the wonders of the Digital World is what motivates him to take writing as a career.

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