USDD’s total reserves comprise TRX (69%), BTC (29%) and TUSD (2%). However, Bluechip does not consider TRX for determining collateralization ratios. The Terra/Luna collapse is a classic example that shows endogenous collateral’s value can collapse to zero overnight.
Reserve Assets as of June 04, 2023 (excluding TRX)
BTC - $382 Million
TUSD - $23.6 Million
Based on the above, USDD has a collateralization ratio of 53%.
96% of USDD’s reserves (excluding TRX) is held in multi-sig wallets and the remaining 4% is held in USDD’s own smart contracts.
We expect minimal storage risk with respect to the assets held in smart contracts but the assets held in the multi-sig wallet entails higher risks.
We believe that USDD’s reserves are commingled with assets of Huobi.
The address 1KVpuCfhftkzJ67ZUegaMuaYey7qni7pPj is claimed to be the BTC reserve wallet which holds USDD’s BTC reserves.
However, according to Huobi executive James Hume and Huobi owner Justin Sun, the above wallet belongs to Huobi.