Hong Kong Moore joins TUSD audit, what are the auditing firms for leading stablecoins?

Source: TUSD

Auditing plays a crucial role in the stablecoin sector. With the rapid development of the digital currency market, stablecoins serve as a bridge between traditional finance and the cryptocurrency world, making their stability and reliability particularly important. Therefore, auditing has become a key means to ensure that the value of stablecoins is genuine and trustworthy. Through independent third-party audits, it can be verified whether the assets backing the stablecoins truly exist and whether they are consistent with their market value.

This transparency and verifiability are essential for maintaining investor confidence, ensuring market stability, and promoting the widespread acceptance and use of stablecoins. Thus, effective auditing not only enhances the credibility of stablecoins but also brings greater security and compliance to the entire digital currency market.

What is the background of TUSD's new auditing firm?

Previously, TUSD was continuously verified in real-time by The Network Firm, an independent professional accounting firm in the United States, to ensure that its dollar reserves matched the circulating token supply at a ratio of 1:1, with a collateralization rate of 100%.

The Network Firm is an independent accounting firm based in the United States, specializing in the digital asset industry. Since 2016, the founding team of the firm has been leading the development of crypto-native accounting and assurance services, as well as traditional tax and audit capabilities, accumulating rich experience from the industry.

On December 25, TUSD announced a partnership with Moore Hong Kong, becoming TUSD's new auditing firm following The Network Firm.

Moore Hong Kong, established in 1975, is a reputable firm in the fields of accounting and consulting. It includes Moore Accountants Limited, Moore Associates Limited, Moore Tax Services Limited, Moore Consulting Services Limited, Moore Transaction Services Limited, Moore Recovery Limited, and First Island Secretary Limited.

As a member of Moore Global, Moore Hong Kong is at the core of this global accounting and consulting network. Moore Global, with over 100 years of history, is rooted in the UK and now has a wide influence worldwide.

Moore Hong Kong provides a full range of services, including auditing, assurance, accounting, business outsourcing, tax, and other consulting services, supported by a strong professional team. Initially serving the shipping and logistics industry, the firm has now expanded into multiple sectors, including insurance and financial services. Its clientele ranges from startups to international listed companies, particularly excelling in the listing domain.

Moore Hong Kong not only possesses a deep understanding of the local market but also leverages its regional structure to provide clients with international perspectives and expertise. Moore Global has over 600 offices in more than 110 countries worldwide, with a strong network particularly in Western Europe, North America, and Australia, and is rapidly expanding in Central and South America, Eastern Europe, and the Middle East. Other offices in the Asia-Pacific region include China, Singapore, Bangladesh, India, Sri Lanka, Indonesia, Japan, South Korea, Malaysia, the Philippines, Thailand, Vietnam, Cambodia, and Mongolia.

As a result, clients of Moore Hong Kong can be assured of receiving in-depth local knowledge and extensive international support. Each Moore firm provides the same high standard of personalized service to ensure that client needs are met. Moore Global's worldwide coverage and diverse services position it prominently in the accounting and consulting industry, particularly excelling in serving medium-sized enterprises.

Leading technology for 24-hour auditing

Previously, TUSD's collaboration with The Network Firm enabled TUSD to achieve 24/7 real-time verification, ensuring transparency and stability of its reserves and providing users with a better investment experience.

At the same time, TUSD has partnered with leading oracle service provider Chainlink, utilizing Chainlink's Proof of Reserves (PoR) technology to ensure minting security, allowing for programmatic minting and real-time on-chain verification of off-chain reserves, further ensuring transparency and reliability. As the first stablecoin to programmatically control minting through real-time on-chain verification of off-chain reserves, TUSD showcases a new paradigm of decentralization, transparency, and independent verification.

With the integration of Chainlink PoR, TrueUSD (TUSD) is the first USD-pegged stablecoin to secure minting with on-chain real-time verification provided by an independent third-party institution, thereby ensuring minting security and further enhancing transparency and reliability. Users can access relevant data anytime through the official website tusd.io, achieving daily automated audits.

TrueUSD (TUSD) and Chainlink's collaboration has enabled TUSD to verify its offline (off-chain) reserves on-chain. This is achieved through Chainlink's oracle technology, allowing TUSD to display the status of its reserves in real-time on the blockchain in a programmatic manner. This technology, known as "Proof of Reserves" (PoR), elevates TUSD's standards in transparency and innovation while also enhancing user trust in TUSD's stability and reliability. This collaboration sets a new standard for transparency and innovation in the decentralized finance (DeFi) space.

How are the auditing firms of other leading stablecoins?

In the stablecoin sector, the choice of auditing firms is crucial for ensuring transparency and enhancing user trust. Comparing the auditing histories of the two major stablecoins, USDT and USDC, as well as the newcomer FDUSD, we can see their respective development paths and differing emphases on auditing standards.

Tether recently announced a partnership with BDO Italia, the fifth-largest accounting firm globally, marking an important step in enhancing its financial transparency. Before collaborating with BDO Italia, Tether had worked with Moore Cayman and MHA Cayman.

It is worth noting that Moore Cayman, which previously collaborated with Tether, and TUSD's new auditing firm Moore Hong Kong are both member firms of the Moore Global network. Moore Global is an international accounting and consulting network with member firms around the world. Although these member firms are connected in terms of brand and resource sharing, they typically operate as independent entities in terms of operations and management. Therefore, while Moore Cayman and Moore Hong Kong belong to the same global network, they operate independently with their own business focuses and markets.

Additionally, Tether plans to transition from quarterly reports to monthly reports and conduct comprehensive audits. Previously, Tether worked with Friedman LLP, but that partnership ended in 2018. Since then, Tether has engaged Freeh, Sporkin & Sullivan LLP for legal consulting and advice, and conducted a comprehensive audit of reserves with MHA Cayman, confirming that its cash and cash equivalents exceed 100% of its liabilities.

Circle's stablecoin USDC has historically been audited by Grant Thornton LLP, one of the largest accounting firms in the United States, which audited the reserves backing USDC held by Circle as of November 30, 2018. Furthermore, Circle announced a partnership with Deloitte for auditing in early 2023 to enhance transparency regarding its reserves.

The auditing firm for First Digital USD (FDUSD) includes Prescient Assurance, a U.S.-registered accounting firm specializing in security testing and compliance certification services. The company's main business includes SOC 2 audits and certifications, ISO 27001 certification, PCI QSA and ASV services, Google OAuth API verification, and more. Prescient Assurance bridges the knowledge gap in cybersecurity testing that most CPA firms providing SOC 2 audits face by assembling an audit team with extensive cloud-native technology and modern application security architecture experience. The firm also offers various other compliance and security certification services, aiming to provide clients with a painless, frictionless, and efficient multi-framework audit experience.

Comparing these three stablecoins, we can see that both Tether and USDC are striving to enhance their transparency and compliance by collaborating with well-known accounting firms to build user trust. However, Tether's auditing history is more diverse, involving multiple different accounting firms, while USDC and FDUSD have more stable partnerships with Grant Thornton LLP and Prescient Assurance, respectively.

TUSD's history and new chapter of development

Over the past six years, from 2018 to 2023, TUSD has undergone multiple transformations.

TUSD, issued by TrustToken, was the first USD stablecoin launched by a regulated operator, predating USDC, USDP, and BUSD. It debuted in April 2018, receiving support from renowned investment firms such as a16z, Founders Fund, and GGV Capital, raising a total of $20 million in investment. Once launched, TUSD quickly listed on major trading platforms such as Binance, Bittrex, and Upbit, showcasing its appeal in the digital currency space.

However, over time, TUSD's market position experienced fluctuations. At the beginning of 2020, its issuance dropped to approximately $150 million, below USDC's $500 million and USDP's $200 million. After an initial period of glory and a mid-term slump, TUSD fortunately saw a turnaround at the end of the same year when it was acquired by the British Virgin Islands investment company Techteryx Ltd., marking the beginning of a new chapter of development.

Under Techteryx's management, TUSD gained new momentum. The company has offices in several countries and regions across Asia, including Singapore and Hong Kong, and has established long-term partnerships with industry-leading enterprises. These initiatives have enhanced user trust in TUSD and propelled its global adoption and development.

By June 2023, TUSD's issuance achieved significant growth, reaching a historical high of over $3 billion, with a market capitalization close to BUSD, making it the fifth-largest stablecoin in the market. Currently, as BUSD "exits the stage," TUSD's market capitalization has become the fourth-largest stablecoin. Notably, TUSD achieved over 200% growth in issuance during the bear market of the cryptocurrency market, demonstrating its unique market resilience and appeal.

In terms of application, TUSD has received significant support and attention on both centralized and decentralized exchanges. On major cryptocurrency exchanges like Binance, Bybit, and HTX, TUSD has become an important trading asset. In the decentralized finance (DeFi) space, TUSD is also listed on major protocols such as PancakeSwap, Curve, and Compound, providing considerable investment returns.

Moreover, in the fields of payment and cross-chain compatibility, TUSD has also achieved rapid expansion and outstanding performance. It has been integrated by multiple platforms such as Alchemy Pay, Binance Pay, Travala.com, UQUID, and HYVE, demonstrating its versatility and practicality in the digital economy, and is compatible with several mainstream public chains such as Ethereum, TRON, Avalanche, BNB Chain, and Polygon.

After undergoing multiple transformations and challenges, TUSD has not only achieved new breakthroughs in auditing transparency but also realized significant growth in market position and user trust. The addition of a new auditing partner, Moore Hong Kong, further solidifies TUSD's position in the stablecoin market. With the continuous development of the cryptocurrency market, TUSD, with its stability, transparency, and innovation, is expected to continue playing an important role in the future.