1. Charges and Settlement
2. Marketing Tactics and SEC Reaction
3. Overall Impact and Fines

Two companies related to the TUSD stablecoin faced charges by the U.S. Securities and Exchange Commission (SEC) for securities violations.

Charges and Settlement

TrueCoin and TrustToken settled charges filed by the SEC, alleging unregistered offering and investment contract sales between November 2020 and April 2023. TrustToken created the decentralized finance lending platform TrueFi, allowing users to utilize TrueUSD (TUSD), a stablecoin issued by TrueCoin.

Marketing Tactics and SEC Reaction

In a September 24 complaint, the SEC stated that both companies used misleading marketing tactics to promote TUSD and TrueFi as “safe and trustworthy” investment vehicles. Jorge G. Tenreiro, the SEC’s acting chief of its Crypto Assets and Cyber Unit, emphasized the importance of company registration for investor protection.

Overall Impact and Fines

Without admitting or denying the charges, TrueCoin and TrustToken agreed to pay fines of $163,766. TrueCoin was also penalized with an additional disgorgement of $340,930. The settlement adds to a growing list of SEC fines against the crypto industry, which has paid over $7 billion to the agency since 2013.

The charges and settlement with TrueCoin and TrustToken underscore the ongoing tension between cryptocurrency companies and SEC regulation.