The reserves backing HUSD, the eighth-largest stablecoin by market cap, are all held in cash in money market accounts in the United States, the token’s issuer, Stable Universal, told CoinDesk. 

It’s the first time the issuer has released such information. (EideBailly, an accounting firm, publishes monthly attestations that the HUSD token is backed 1-to-1 with dollars, but has never provided a reserve composition.) The disclosure comes at a time when an increasing number of stablecoin issuers have started revealing the breakdown of their reserves, as investors and regulators demand more transparency. 

“The reserves backing HUSD are currently backed 100% by cash held in money market accounts,” the company said in an email. “The current asset composition does not contain ‘cash equivalents,'” such as “U.S. government Treasury bills, bank certificate of deposits, bankers’ acceptances, corporate commercial paper, and other money market instruments.”

Money market accounts are deposit accounts at a bank or credit union that pay interest based on the market for short-term funds. They should not be confused with money market mutual funds, which are mutual funds that invests directly in debt securities such as U.S. Treasurys and commercial paper.

Stable Universal did not give a date for the breakdown.

In May, the largest stablecoin issuer, Tether, released a breakdown of its reserves for the first time, following a settlement with the New York Attorney General’s office. Roughly half of Tether’s reserves were invested in commercial paper, the company said. To this day it has not identified any of the issuers.

In June, Circle, the issuer of the No. 2 stablecoin that plans to go public, revealed the assets backing USDC, after CEO Jeremy Allaire pledged to improve transparency. That disclosure said 13% of the stablecoin’s collateral was invested in Yankee certificates of deposit (CDs issued by non-U.S. banks), 12% U.S. Treasuries and 9% in commercial paper; the remaining 61% was in “cash and cash equivalents” but that figure was not broken down further.

Paxos also revealed a breakdown of assets backing PAX and BUSD for the first time, with 96% in cash and cash equivalents and the remaining 4% backed by U.S. Treasury bills. 

Though USDT and USDC still capture the largest market share, issuers of smaller stablecoins, such as BUSD, HUSD and GUSD, are releasing more information to bolster investor confidence.

“The HUSD stablecoin ensures that each HUSD is backed by 1 U.S. dollar, held in its safest form,” Stable Universal said in the statement. It aims to ensure “sufficient liquidity and guarantee for customers to redeem their stablecoin assets for fiat in real-time, regardless of market volatility,” according to the company.

“The plan is to hold these reserves in only cash, cash equivalents and short-term, low-risk financial instruments to ensure that the balance of assets held in reserve either meets or exceeds the volume of HUSD in circulation at all times,” said the statement. 

Created in 2019, HUSD is a Huobi-branded stablecoin (though technically, the “H” in HUSD stands for “hot”) created by Stable Universal, a British Virgin Islands company. On June 24, Stable Universal appointed Nevada-licensed retail trust company Huobi Trust as its custodian, replacing Paxos Trust, which was the custodian when the token launched.

HUSD has a market cap of $499.6 million and a 24-hour trading volume of $46 million as of Aug. 4, according to CoinGecko.