Curve Finance is considering removing TrueUSD from its collateral pool due to SEC allegations against TrueCoin.

SEC's Accusations and Implications

On September 25, the SEC charged TrueCoin LLC and TrustToken Inc. with fraud and the unregistered sale of investment contracts. The SEC states that a significant portion of TUSD's reserves was invested in a highly speculative and illiquid offshore investment fund, raising questions about TUSD's stability.

Curve Governance Proposal

In response, Wormhole, a cross-chain messaging protocol, proposed changes in Curve's governance forum. The proposal suggests reducing the TUSD backing for crvUSD to zero to avoid risks associated with regulatory and solvency concerns. Currently, Wrapped Bitcoin (WBTC) constitutes the largest portion of crvUSD's collateral, followed by Wrapped Staked Ether (wstETH) from Lido Finance.

TUSD's Links to Justin Sun

TrueUSD was launched in 2018 and has become a key stablecoin, maintaining its peg to the U.S. dollar through escrow accounts. However, current scrutiny of TUSD coincides with longstanding rumors about Justin Sun, Tron's founder, allegedly having undisclosed ties to TUSD.

The consideration to remove TUSD from the collateral pool evolves amid SEC accusations and rumors of links to Justin Sun, raising concerns about the digital asset's stability and safety.