On April 21, Justin Sun, the founder of Tron, announced the launch of a decentralized algorithmic stablecoin called USDD. Sun said Thursday that the USDD network “will provide custody services for the $10 [billion] Value highly liquid assets raised by blockchain industry initiators and use them as an early-stage reserve.”
Tron is launching a native stablecoin called USDD
Justin Sun from the Tron Network has uncovered a new stablecoin issued on the blockchain Tron. The announcement was also published on hejustinsun.com in a blog post titled “An Open Letter on the Issuance of USDD, a Decentralized Algorithmic Stablecoin on Tron.” The letter explains how stablecoins have evolved from the “omni-USDT 1.0 era” to decentralized algorithmic stablecoins. The blog post describes that the Tron DAO has partnered with “major blockchain players” to launch USDD. The blog post goes on to claim that USDD will be “the most decentralized stablecoin in human history.”
Tron’s USDD launch follows the exponential rise of a few decentralized stablecoins. First Makerdao’s DAI has propelled itself to the top spot in terms of market cap among stablecoins as it offers an over-collateralization method to maintain its dollar peg. More recently, Terras UST has outperformed DAI’s market valuation and also offers an algorithmic reserve method to maintain its dollar peg. Terras UST is now the third largest stablecoin project as it has a market cap of $17.89 billion.
In fact, USDD works very similar to Terra’s UST and Sun explained On Thursday, it will be backed with $10 billion in crypto reserves to launch. “In the stablecoin 3.0 era, USDD will not rely on centralized institutions for redemption, management, and custody,” the hejustinsun.com blog post reads. “In the stablecoin 3.0 era, USDD will not rely on centralized institutions for redemption, governance and custody. Instead, it will achieve full on-chain decentralization.” The blog post adds:
USDD is linked to the underlying TRX and issued decentrally. When the price of USDD is below USD 1, users and arbitrageurs can send USD 1 to the system and receive USD 1 worth of TRX.
Terra Founder Do Kwon congratulates Tron DAO and Justin Sun
While a number of people on Twitter called Justin Sun and Tron’s new stablecoin is a “UST double”, Terra’s founder Do Kwon spoken about the comments addressed to USDD. “It should be obvious, but — the more automakers go electric, the more Tesla wins,” Do Kwon said. “Similarly, UST gains as more blockchains issue their own sovereign stablecoins. The real moon is in helping as many communities as possible become self-reliant.”
In another tweet, Do Kwon congratulated the Tron DAO and Justin Sun. Terra’s founder called:
Tron DAO launches an algorithmic stablecoin with mint and burn mechanics called USDD – Mint and Burn TRX, redeem for TRX. Decentralized economies make decentralized money – every blockchain keeps running [decentralized] stable soon.
Tron’s new stablecoin was a current conversation on social media on Thursday. While USDD will allow people to mint and burn with TRX and hold billions in crypto reserves, some people recommended The project should also include Bitcoin (BTC). Additionally, Sun’s tweet on Thursday further noted that the Tron DAO reserve will “fix its risk-free base rate at 30% per year.”
What do you think of Tron and Justin Sun’s new USDD stablecoin? Let us know what you think about this topic in the comment section below.
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