In a fresh blow to Binance, the world’s largest cryptocurrency exchange, TrueUSD (TUSD) has announced a pause in its minting process through crypto custodian Prime Trust. This development adds to the existing woes faced by Binance, following the recent charges brought against the exchange and CEO Changpeng “CZ” Zhao by the US Securities and Exchange Commission (SEC). Let’s dive into the details and explore the implications for Binance and the crypto market as a whole.
TUSD mints via Prime Trust are paused for further notification.
Thanks for your understanding and we are sorry for any inconvenience. Please contact [email protected] for any further questions.
— TrueUSD (@tusdio) June 10, 2023
Troubles Mount for Binance: TUSD Minting Paused
TrueUSD revealed on June 10 that the minting of TUSD via Prime Trust has been temporarily halted. This presents a new set of challenges for Binance, as the exchange had started supporting TUSD after the SEC ordered Paxos to cease minting Binance USD (BUSD) stablecoin.
Despite the pause in minting, TrueUSD assured users that the services for TUSD redemption and transactions will continue to operate without any disruptions. The company emphasized that its partnerships with other banking institutions remain intact, ensuring a seamless experience for TUSD holders.
TUSD Reserves and Real-Time Balance
The majority of TUSD reserves are held in Prime Trust, alongside First Digital, Capital Union, Manual, and BitGo. As per the real-time reserve balance, the current supply of TUSD stands at 2.50 billion tokens, with USD-denominated collateral held in accounts totaling $2.08 billion.
Amid rumors of insolvency surrounding Prime Trust, crypto custodian BitGo has reportedly reached a preliminary agreement to acquire the troubled custodian. This potential acquisition reflects the challenges faced by custodians in the wake of the bear market and intensified regulatory scrutiny in the US crypto space.
Crypto Market Slump and Altcoin Liquidation
The crypto market experienced a significant downturn following the SEC’s legal actions against Binance and Coinbase. Market makers, including Jump Crypto and Cumberland, withdrew liquidity from altcoins, resulting in a tight market environment. Hedge fund Scimitar Capital is allegedly linked to a massive $2 billion liquidation of altcoins.
In the last 24 hours alone, over $350 million worth of cryptocurrencies were liquidated, marking one of the largest liquidation events in crypto history. Both Bitcoin and Ethereum witnessed drops of over 4% and 5% respectively, with expectations of further declines during US market hours.
How will Binance overcome these hurdles, and what does this mean for the broader crypto industry? Let us wait and see!