TUSD operator moves $1 billion in reserves from the United States to the Bahamas

The operator of True USD (TUSD), Archblock, has raised the reserves of the stablecoin held at the Bahamas-based Capital Union Bank to $1.4 billion from $438 million as of March 10. Bloomberg reports.

The decision was taken after closure of SBNY, formerly the organisation’s largest partner, as well as crypto-friendly banks Silvergate Capital and SVB.

This has complicated the companies’ business, forcing them to explore alternatives for holding fiat cash and for transferring funds to clients, the agency noted.

According to an attestation report verified by ChainArgos, on March 13 Archblock held $852 million in SBNY accounts.

“Even operating accounts for simple tax payments, salaries and expense payments are very hard to obtain if you are not a multi-billion-dollar business. The recent banking collapse only underscores the risk of concentration that arises from the absence of clear rules. I doubt the chaos of the last 72 hours would have been possible if firms like ours were allowed to work with Citi or JPMorgan,” said Archblock CFO and COO Alex de Lorraine.

Capital Union Bank acts as a partner for crypto businesses, offering the ability to deposit and perform operations with digital assets on the same account as traditional currencies or assets. In particular, the institution stores reserves of the issuer of Tether.

“We moved the funds to Capital Union Bank to safeguard them, since we can immediately invest in U.S. Treasuries, which is itself somewhat amusing. The funds are in the United States, but to achieve this goal we need to use an offshore bank,” de Lorraine explained.

TUSD rose to fifth in market capitalization among stablecoins at $2.05 billion, according to CoinGecko. On March 1 it stood at $1.12 billion.

Interest in the asset intensified amid US regulators’ crackdown on the Binance-linked BUSD asset. The platform recently announced zero fees in pairs with TUSD.

Earlier, Glassnode analysts noted an increase in USDT’s share to 57.8% amid a depeg of USDC, DAI, FRAX, USDP, USDD and GUSD.

As reported, representatives of the stablecoin issuer USDC — Circle and Coinbase — said that problems in the banking sector have led to uncertainty in the crypto markets.