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TrueUSD, the prominent stablecoin, has made the unexpected decision to suspend its token creation via Prime Trust, leading to speculation and uncertainty within the industry.
While the move has raised questions, TrueUSD has reassured users that it maintains strong relationships with other banking counterparts, ensuring uninterrupted transactions. It's important to note that the suspension does not impact the minting and redemption of TUSD through other financial institutions.
The stablecoin's performance over the past year has raised concerns about its USD-pegged status, as it has deviated from its established norm on multiple occasions.
The decision to halt minting has also raised suspicions about any potential connection to the rumors of insolvency surrounding Prime Trust. The Nevada-based fintech infrastructure company faced significant challenges earlier this year, leading to a workforce reduction of one-third in January.
Prime Trust has played a crucial role as a bridge between Binance.US and its banking partners, safeguarding customer funds when US financial institutions were becoming more cautious with crypto businesses.
In a separate development, BitGo, a prominent crypto custodian, is reportedly in advanced negotiations to acquire Prime Trust. BitGo's non-binding letter of intent, announced on June 8, outlines the potential acquisition, with specific terms yet to be disclosed. If the deal goes through, BitGo would benefit from Prime Trust's payment system and crypto IRA fund, expanding its wealth management services.
These moves come amidst regulatory considerations by the US Securities and Exchange Commission (SEC), which might introduce changes limiting crypto companies from acting as custodians for their clients.
As the crypto landscape undergoes rapid transformations, these strategic maneuvers reflect shifts in power within the industry. The focus now centers on the future of TrueUSD and the impending changes at Prime Trust, as the sector continues to evolve.
