Gemini | Bluechip

Gemini Trust Company (“Gemini”), the issuer of GUSD, is regulated as a stablecoin issuer by the NYDFS, and, therefore, subject to stringent guidelines and monitoring requirements. It is one of the safest fiat-backed stablecoins.
GUSD’s reserves comprise short dated US Treasuries, money market funds invested in US Treasuries, and cash deposits in fully segregated and bankruptcy-remote accounts
All KYC’d holders may redeem GUSD for USD directly through Gemini or trade GUSD for other stablecoins on centralized exchanges.
Although GUSD is designed to be institutional-grade, compliant with regulations and customer protection-focused, it is not widely used in the crypto markets, and hence lacks significant liquidity on exchanges. Therefore, GUSD is most suitable for (a) making and receiving payments and (b) passive stablecoin holders who seek exposure to USD but cannot or do not want to hold USD in a bank account.

The Stability factor is evaluated on the following:

Reserves Management - Quality, quantity, storage and segregation of reserve assets
Market Feedback - Indicators of market's confidence in a stablecoin derived from price and trade data
Mechanism - Stabilization methods that protect the stablecoin

The Management factor is evaluated on the following:

1. Restrictions - What deterrents exist to prevent key personnel of stablecoin projects from unethical and illegal behavior?
2. Negative Track Record - Have key personnel been involved in scams, frauds or other illegal activities?

This factor aims to assess risks arising from technical implementations – i.e, smart contract code and oracles. It is currently not assessed, but we plan for it to be evaluated in the future.

The Decentralization factor is evaluated on the following:

1. Platform Censorship Risk
2. Custodian Risk
3. Type of Collateral
4. Diversified voting Power
5. User Censorship Risk

The Governance factor for fiat-backed stablecoins is evaluated on the following:

1. Holder Protection - What rules, statutes or code exist to protect interests of stablecoin holders?

2. Reserves Verification - What checks are done to ensure existence of reserves?

3. Redemptions - Do issuers have transparent and reasonable redemption terms?

This factor seeks to incorporate external feedback mechanisms such as market and social sentiment into our internal ratings. It is currently not assessed, but we plan for it to be evaluated in the future.