On May 29th, Chinese officials detained Trust Reserve’s core team, which is responsible for issuing two stablecoins, as reported by PANews. Trust Reserve’s office in Shanghai was reportedly empty and sealed with a “Judicial seizure, strict non-destructive” notice, indicating an active investigation.
Trust Reserve principally deals with the offshore stablecoin CNHC and HKDC stablecoin, which could be impacted by the ongoing situation. By all accounts, Trust Reserve has a limited promotion for its stable currency business, but the company also operates a cross-border payments business that may be impacted by this incident.
It has been revealed that CNHC’s recent funding round was classified as Series A+, having already raised undisclosed amounts over two years, totaling “tens of millions of dollars” between March and August. CNHC stablecoin, which was introduced in 2021, has a total supply of around 15 million tokens ($2 million equivalent) and is used for remittances and cross-border commercial payments. They also utilize Ethereum and Conflux blockchains. Tether’s CNHT, on the other hand, has a supply of roughly 20 million tokens.
The detention of Trust Reserve’s core team and the ongoing investigation is a cause for concern about the stability and potential of the CNHC and HKDC stablecoins. This could potentially impact the company’s stable currency and cross-border payments businesses along with investor confidence in the project.
Compiled by Coinbold