Token Description & Project Background

TruFi presents an innovative lending marketplace that enables borrowers to obtain on-chain loans without the need for collateral lock-up. Since providing its inaugural uncollaterlized loan to Alameda Research in 2020, the protocol has facilitated close to US$2 billion in collateral-free loans, leading to lenders receiving a rewarding sum of approximately US$40 million in rewards. 

To contribute to the liquidity pool, lenders supply assets like USDC, USDT, or TUSD, which are then made accessible to approved borrowers. In return for providing liquidity, lenders are incentivized with TRU rewards. Borrowers seeking capital from TruFi liquidity pools must undergo creditworthiness assessment and obtain approval from TRU token stakers. 

TRU token services as the native governance token for the platform. Token holders participate in staking to vote on protocol parameters, veto borrowers and receive rewards for their efforts. TrustToken, a San Francisco-based company founded TRU and is led by Rafael Cosman, an alumnus of Stanford University who studied artificial intelligence and cryptography. Rafael has previously contributed to renowned entities such as Palantir and Google Brain. 

TRU was distributed via private sale to notable investors such as BlockTower Capital, Andreessen Horowitz, and Alameda Research, generating approximately US$12.5 million. 

Risks of TRU

Like an investment in other crypto assets, there are some general risks to investing in TRU. These include: (i) volatility risk and liquidity risk, (ii) short history risk, (iii) demand risk, (iv) forking risk, (v) code defects, (vi) regulatory risk, (vii) electronic trading risk, and (viii) cyber security risk. For additional information of these and other general risks associated with crypto assets and Uphold’s platform, please refer to the Risks Specific to Holding Digital Assets statement.

In addition to these general risks, an investment in TRU is subject to the following specific risks:

• TRU operates using smart contracts, which have an association with vulnerabilities and security breaches. Despite undergoing successful audits by well-regarded third-party entities, it is essential to acknowledge the existence of inherent risks. Furthermore, the project’s future trajectory hinges on the decisions made by a global community of TRU token holders. 

We emphasize that this Crypto Asset Statement is not an exhaustive description or summary of all risks associated with TRU. Investors should conduct their own research and perform their own assessment before trading any crypto asset to determine the appropriate level of risk for their personal circumstances.

The TRU community and TrustToken are not under any legal or regulatory obligation to disclose material information to the public regarding its activities. Holders of TRU have no recourse to, TrustToken, TRU founders, community, or Uphold if TRU declines in value for any reason.

Changes to applicable law may adversely affect the use, transfer, exchange, or value of any of your crypto assets, and such changes may be sudden and without notice.

Uphold’s Evaluation Process

Prior to listing TRU on the Uphold Platform, Uphold performed due diligence on TRU and determined that TRU is unlikely to be a security or derivative under relevant securities legislation. Uphold’s analysis including reviewing publicly available information on the following: 

• The creation, governance, usage, and design of TRU, including ensuring the source code is open-source, audited and peer reviewed, security, and roadmap for growth in the developer community. 
• The supply, demand, maturity, utility, and liquidity of TRU.
• Any marketing materials put forward by the TRU social team including on, Twitter, Medium blog, LinkedIn posts, Discord and Telegram channels.
• Material technical risks associated with TRU, including any code defects, security breaches and other threats concerning TRU and its supporting blockchain (such as the susceptibility to hacking and impact of forking), or the practices and protocols that apply to them.
• Legal and regulatory risks associated with TRU, including any pending, potential, or prior civil, regulatory, criminal, or enforcement action relating to the issuance, distribution, or use of TRU. 

General

Uphold has prepared this Crypto Asset Statement based on publicly available information. Although Uphold has taken steps to obtain information from apparently reliable sources, information contained in this Crypto Asset Statement may be inaccurate, incomplete or out-of-date. This overview is a starting point for you to perform your own research prior to investing in a crypto asset.

Uphold users should read the Risks Specific To Holding Digital Assets statement for additional discussion of general risks associated with crypto assets made available through the Uphold platform.  

Canadian residents, please note that Uphold has filed an application for registration in certain Canadian jurisdictions but has not yet obtained registration. Until such time as Uphold obtains registration, Uphold has agreed to abide by the terms of an undertaking available at the following link. Please also review the Uphold Canada – Crypto Risk Statement for additional discussion of general risks associated with the crypto assets made available through Uphold Platform. Please be aware that statutory rights of action for damages or rescission in section 130.1 of the Securities Act (Ontario) and, if applicable, similar statutory rights under securities legislation in the other provinces and territories of Canada do not apply in respect of this Crypto Asset Statement or other disclosures on the Uphold website and Risks Specific To Holding Digital Assets statement. 

Last updated on June 21, 2023.