The reserves backing the HUSD stablecoin are fully comprised of cash held in U.S. money-market deposit accounts. This was disclosed by its issuer, Stable Universal.
The team at HUSD is releasing our own breakdown and analysis of the reserves backing the $HUSD stablecoin.
And we are willing to build on the increasing transparency of the stablecoin market.
Read More👇https://t.co/8L3jZFrKpr
— HUSD (@Stablecoin_HUSD) August 5, 2021
According to CoinGecko, HUSD ranks ninth among stablecoins with a market capitalization of $512.9 million.
Previously the issuer published audited monthly reports by EideBailly on HUSD’s full backing, though its composition was not disclosed.
«At present, the reserves of HUSD are 100% comprised of cash held in money market deposit accounts. “Cash equivalents,” including U.S. Treasury securities, bank certificates of deposit and acceptances, commercial paper and other money market instruments, are not represented in the asset basket,»— according to Stable Universal.
The issuer did not specify the date of the report.
Money market deposit accounts are opened by banks or credit unions and offer higher yields than checking accounts. They differ from money market funds, which invest directly in debt securities.
«HUSD guarantees that every stablecoin is backed by one U.S. dollar held in the safest possible form. Thanks to this, there is sufficient liquidity and assurances that clients can convert stablecoins into fiat in real time, regardless of market volatility. We plan to continue holding reserves in this form so that their balances match or exceed the amount of HUSD in circulation at any moment,»— the company explained.
An updated version of the HUSD stablecoin was released by Huobi in July 2019. It was issued by Stable Universal and Paxos Trust Company.
Circle previously disclosed information about backing of its stablecoin. Cash and cash equivalents comprised 61% of USD Coin (USDC), with the remaining coins backed by bonds and other high-liquidity assets.
The issuer of the stablecoin Tether (USDT) disclosed its reserves in the May quarterly report. 76% of the coins are backed by cash and cash equivalents, the remainder by bonds, digital assets and other instruments.
As reported, Paxos reserves—Paxos Standard (PAX), Binance USD (BUSD)—are 96% comprised of cash and cash equivalents and 4% in U.S. Treasury bills.
By late May, the total capitalization of stablecoins exceeded $100 billion. The head of the decentralized domain registrar Unstoppable Domains, Matthew Gould predicted growth of the stablecoin market to $1 trillion by 2025.
In July, Jerome Powell, the head of the ФРС of the United States, expressed doubts about the necessity of stablecoins. He compared stablecoins to money-market funds and savings banks.
In July, U.S. Treasury Secretary Janet Yellen called for the swift creation of a regulatory framework for stablecoins.
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