Overview
trUSD is fully backed by the protocol’s reserve assets. The backing model is designed to maintain stability while enabling yield generation for strUSD holders through market-neutral trading strategies. Every trUSD in circulation is backed by real assets held in secure custody, verified in real-time by independent third parties.How Backing Works
The Backing Model
Unlike fiat-backed stablecoins that hold dollars in bank accounts, Tori’s backing consists of assets deployed in hedged trading positions:| Aspect | Description |
|---|---|
| Full Backing | Every trUSD is backed by underlying assets |
| Hedged Positions | Positions designed for minimal directional exposure |
| Active Management | Professional management with continuous monitoring |
| Yield Generation | Returns from strategies flow to strUSD stakers |
How It Compares
| Model | Backing Type | Yield Potential |
|---|---|---|
| Fiat Stablecoins | Cash & T-bills in banks | Low (none for holders) |
| Algorithmic Stables | Algorithmic mechanisms | Variable |
| Tori (trUSD) | Hedged trading positions | Passed to strUSD stakers |
Real-Time Transparency
We believe in radical transparency. All backing is independently verified and publicly accessible:Proof of Reserves
Accountable
Independent, real-time attestations of all protocol reserves. Accountable provides cryptographic proofs that anyone can verify at any time.
- Total assets under management
- Asset composition and allocation
- Liability coverage ratio
- Reserve fund status
On-Chain Verification
All on-chain components are publicly verifiable:- Smart contract balances
- Token supply
- Transaction history
- Staking contract state
Custody Architecture
All assets are held in institutional-grade secure custody across two layers:On-Chain Assets
| Security Layer | Provider | Description |
|---|---|---|
| Smart Contract Audits | Sherlock | Comprehensive security audits with ongoing bug bounty |
| Real-Time Monitoring | Hypernative + Internal | AI-powered 24/7 threat detection |
| Multi-Signature | Internal | Critical operations require multiple approvals |
Off-Chain Assets
| Security Layer | Description |
|---|---|
| Institutional Custodians | Qualified custodians with segregated accounts |
| Counterparty Standards | Only established, reputable counterparties |
| Segregation | User funds never commingled with operations |
We only work with counterparties that meet our rigorous due diligence standards. All off-chain assets are held with qualified institutional custodians.
Risk Management Framework
The backing model incorporates multiple layers of risk management:Position-Level Controls
| Control | Purpose |
|---|---|
| Position Limits | Cap exposure to any single position |
| Concentration Limits | Ensure diversification across assets |
| Stop-Loss Rules | Automatic risk reduction on adverse moves |
Portfolio-Level Controls
| Control | Purpose |
|---|---|
| VaR Limits | Value-at-Risk constraints on total portfolio |
| Stress Testing | Regular scenario analysis for extreme conditions |
| Correlation Monitoring | Ensure true diversification |
| Liquidity Requirements | Maintain sufficient liquidity for redemptions |
Reserve Fund
A portion of protocol revenue is allocated to a Reserve Fund that serves as an additional buffer against adverse conditions.Verification
Anyone can verify the protocol’s backing:1
View Proof of Reserves
Access real-time attestations from Accountable showing total assets and liabilities.
2
Check On-Chain Data
Verify smart contract balances and token supply directly on the blockchain.
3
Review Attestation Reports
Access detailed attestation reports for comprehensive backing information.