Agora CEO Questions Anchorage's Rating Report Labeling AUSD as a High-Risk Asset

Agora CEO Nick van Eck is questioning the "Stablecoin Security Assessment Matrix" released by Anchorage Digital, which lists AUSD as a high-risk asset.

Van Eck accuses Anchorage's rating of being biased due to its commercial partnerships with stablecoin companies such as Paxos. Anchorage previously delisted AUSD and USDC citing "structural risks," but van Eck claims this was retaliation because Agora refused to use its paid service products.

Anchorage responded that the rating is based entirely on publicly disclosed information, with assessment dimensions including reserve composition, banking partners, and regulatory compliance. In its rating, PayPal's PYUSD and Paxos' USDP ranked at the top, followed by USDT, RLUSD, and others. Agora disclosed that its reserves are managed by State Street Bank, with VanEck serving as the investment manager.

Pay to Play

Much has been made about how parts of the crypto industry operate under a “pay to play” model. This is extractive, harms consumers, and creates opacity in markets. Seemingly, that “pay to play” nature has now permeated the regulated intersection of stablecoins and custodians.

Last week an executive from @Anchorage reached out to me offering their “Genius Bill as a Service” product. I declined, stating we are in deep conversations on our own licensure, have been operating compliantly since inception and have deep expertise in regulated financial markets due to our team’s career experience and uniquely deep relationship with State Street and VanEck.

Following that conversation, Anchorage published a piece, “Anchorage Digital Publishes Stablecoin Safety Matrix, Enables Auto-Conversions to Safe Stablecoins.” In it, they state that Anchorage is delisting both USDC and AUSD for safety concerns, while publishing easily verifiable and known factual inaccuracies. Factual inaccuracies that they have known since our initial listing by Anchorage, corrected again by VanEck representatives before publication of the report, and then were still published and have yet to be retracted. “Specifically, we identified elevated concentration risks associated with their issuer structures—something we believe institutions should carefully evaluate.” Ironically, VanEck has served hundreds more institutional clientele for decades longer than Anchorage has existed. As of writing, VanEck manages more money than the aggregate asset value of all stablecoins in existence, with the exception of Tether.

In this report, Anchorage, failed to disclose their economic relationship with Paxos, the issuer of 3 of their top 4 rated stablecoins. Partners of Paxos (ie. Anchorage) earn a revenue share and basis point fee on mints of their stablecoins, and they have a unique preferred agreement where they get ALL of the revenue from those stables if they sit on the Anchorage platform. That relationship is clearly pertinent to potential customers who might read this report. The same Anchorage executive who reached out to me, confirmed two companies were planning to use their “Genius Bill as a Service” product. I surmise they are deemed “safe” stablecoins.

If Anchorage had just delisted USDC and AUSD to prioritize the stablecoins that they have an economic interest in, I would understand it as a business decision. Private businesses can and should act in their own interests.

But attempting to delegitimize AUSD and USDC for “security concerns”, while knowingly publishing false information, is unserious and bizarre.

So let me reiterate and categorize the errors about AUSD: State Street is the cash custodian and fund administrator of The Agora Reserve Fund. VanEck, a $100B+ asset manager, is the investment manager of The Agora Reserve Fund. Anchorage has known this since initial listing and that was confirmed again by VanEck representatives before publication. By their own matrix AUSD should receive a score similar to or better than USDG if the framework was applied uniformly.

I’m sure that Circle, the issuer of USDC, also has similar inaccuracies to correct and claiming that USDC is less safe than USDT, USDG, PYUSD, and USDP clearly belies their true intentions. Circle is a publicly traded company on the NYSE with many years of audited financials and transparency.

As the pioneers of the open-partner framework, Agora is constantly expanding our network of support. At Agora, we endeavor to always be the most transparent, customer driven, programmable money that serves a global customer base. We are underdogs, relish the fight, and will never pay to play.

Nick van Eck
CEO and Co-Founder of Agora