Compliance & KYC

This page is maintained by the Texas Stable Dollar operators to answer the compliance questions we get asked most. It describes what the bridge actually does today. It is not a certification, an audit, or legal advice.

We are a bridge, not a dollar issuer — and definitely not the State of Texas

This is the single most important thing to understand about TSD. We do not hold your dollars. We do not take deposits of fiat currency. We never touch a bank account on your behalf. And we are not issued, endorsed, backed, or regulated by the State of Texas or any other government.

What we hold is stablecoins that already exist — USDC, USDT, PYUSD and DAI. Those tokens are issued, backed, attested, frozen, and redeemed for real dollars by their issuers: Circle, Tether, Paxos/PayPal and Sky respectively. Those issuers run the banking relationships, the reserve attestations, the sanctions screening, and the know-your-customer process for the underlying dollars. That is their job, and they are regulated to do it.

Our job is much smaller and much more boring: you send us a stablecoin on Ethereum, Base or BNB Smart Chain; we lock it; and we represent your claim on it as TSD on the TEXITcoin Omni Layer 2. Send TSD back and we release the stablecoin. TSD is the same dollar you already had — we just call it something different while it lives on our chain.

What that means in practice

• Every dollar of value entering the bridge has already passed through a regulated stablecoin issuer's compliance process. Nobody mints TSD out of thin air or out of cash.
• We cannot create dollars, and we cannot create TSD without a matching stablecoin deposit arriving on-chain first. Minting is mechanical, not discretionary.
• If an issuer freezes or blacklists an address, that action applies to the underlying token and we are bound by it like every other holder.

Do you collect my identity?

No. Using the bridge requires no identity documents, no selfie, no proof of address. A wallet address in, a wallet address out. An optional email-based membership exists purely so you can get permanent deposit addresses and see your own history — it is convenience, not verification, and we do not ask you to prove who you are.

We are not a custodian of fiat, not a bank, not a money transmitter of national currency, and we do not present ourselves as any of those things.

Jurisdiction screening

We do not knowingly serve comprehensively sanctioned jurisdictions. Requests are screened at the network edge by country, and blocked jurisdictions are refused both in the interface and server-side, so the API cannot be used to route around the check.

We are deliberately honest about the limits of this control: it is a soft control. It reads the country your connection appears to come from. Anyone using a VPN, proxy, or Tor defeats it trivially. It is not identity verification and we do not claim it prevents anyone from transacting — it means we are not knowingly offering the service where we should not.

Attempting to evade this screening is a violation of our Terms of Service, and doing so does not make your use of the bridge lawful in your jurisdiction.

Sanctions and issuer-level enforcement

TSD is a managed token on the TEXITcoin Omni Layer, which means the issuer retains the technical ability to revoke tokens. We will use that ability where we are legally required to, or where tokens were created in error. We will not use it to interfere with lawful holders, and any such action is recorded in our internal audit log.

Reporting and cooperation

We respond to lawful requests from competent authorities regarding on-chain activity we can observe. Because we do not collect identity documents, what we hold is limited to blockchain data — addresses, amounts, transaction hashes, timestamps — plus an email address if you voluntarily created a membership. See the Privacy Policy for what is retained and for how long.

Your responsibilities

• Ensure your use of the bridge is lawful where you are.
• Do not use the bridge if you are a sanctioned person or acting on behalf of one, or if you are located in a comprehensively sanctioned jurisdiction.
• Do not use the bridge to launder proceeds of crime or to finance terrorism.
• Verify deposit addresses only in our interface. Addresses seen in your wallet history can be poisoned by attackers, and funds sent to the wrong address cannot be recovered.

What we do not claim

We do not claim to be SOC 2, ISO 27001, PCI, GDPR-certified, or licensed as a money services business. We do not claim a third-party audit of reserves. What we offer instead is continuous, machine-verifiable proof: signed hourly reserve attestations you can pull yourself from our public API and check on-chain, address by address, on proof of reserves.