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Tron’s Stablecoin USDD Falls to $0.97, USDC Deployed to Defend the $1 Parity

News Feed - 2022-06-14 04:06:57

Tron"s Stablecoin USDD Falls to $0.97, USDC Deployed to Defend the $1 Parity


After the Terra UST fallout and the current crypto market volatility, many eyes have been focused on the Tron-based algorithmic stablecoin USDD. On June 13, the crypto asset tron (TRX) dropped significantly in value and Tron’s founder Justin Sun spoke about traders shorting the digital currency. Sun explained that the Tron DAO Reserve would deploy $2 billion to “fight them” and said he didn’t think the shorters could last 24 hours. Furthermore, the stablecoin USDD took a small dive on Monday, dropping to $0.977 per unit during the crypto market carnage. Another Stablecoin Wobbles, While the Crypto Economy’s Value Drops Massively — Tron DAO Reserve Deploys USDC to Defend USDD Peg


On one of the blackest Mondays in the world of crypto assets, the stablecoin USDD fell to $0.97 per unit and the Tron DAO Reserve had to deploy funds to defend the $1 parity. “For the market extreme condition, [Tron DAO Reserve] has received 700 million USDC to defend [the] USDD peg. Now USDD collateralization rate is nearly 300%,” the organization tweeted.


While a quick dip to $0.97 isn’t the biggest deal to some investors, and USDD moved back to the $0.99 region, the same thing happened to UST the day before the massively larger de-peg. It is also being said that Tron’s native asset TRX is being heavily shorted by traders and Justin Sun explained that $2 billion would offset the shorters causing a short squeeze.


“Funding rate of shorting TRX on Binance is negative 500% APR,” Sun tweeted. “[Tron DAO Reserve] will deploy 2 billion USD to fight them. I don’t think they can last for even 24 hours. [A] short squeeze is coming,” he added. Sun Believes Overcollateralization Will Make Market Participants ‘More Comfortable’ With USDD


Then the Tron DAO Reserve announced a number of purchases meant to defend the peg. After the 700 million USDC was purchased, the organization bought another 100 million USDC, and then another 100 million more USDC after that.


“Currently USDC supply on TRON has reached $2.5 billion,” the Tron DAO Reserve remarked after adding 650 million USDC to the reserve. Tron’s claim is that USDD backing will be overcollateralized by at least 130% and Sun believes this method will make investors more comfortable with the stablecoin.


“We want to have USDD to be overcollateralized, which I think will make market participants more comfortable about using us in the future,” Sun told Bloomberg on June 5. Tags in this story $1 Parity, Algorithmic stablecoin, defend the peg, H.E. Justin Sun, justin sun, overcollateralization, Stablecoin, Stablecoins, Terra, Terra UST, Tron (TRX), Tron Blockchain, Tron DAO, TRON DAO Reserve, trx, USDD, USDD Reserves


What do you think about the Tron stablecoin USDD and its fight against the market carnage? Let us know what you think about this subject in the comments section below. Jamie Redman


Jamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 5,000 articles for Bitcoin.com News about the disruptive protocols emerging today. Crypto Lending Company Blockfi Cuts Staff by 20% NEWS | 2 hours ago Lawsuit Accuses Binance US of Selling Unregistered Securities, False Advertising Terra UST as "Safe" NEWS | 6 hours ago


Image Credits: Shutterstock, Pixabay, Wiki Commons Previous articleLawsuit Accuses Binance US of Selling Unregistered Securities, False Advertising Terra UST as ‘Safe’ Next articleCrypto Lending Company Blockfi Cuts Staff by 20% Disclaimer: This article is for informational purposes only. It is not a direct offer or solicitation of an offer to buy or sell, or a recommendation or endorsement of any products, services, or companies. Bitcoin.com does not provide investment, tax, legal, or accounting advice. Neither the company nor the author is responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content, goods or services mentioned in this article. Read disclaimerShow comments More Popular NewsIn Case You Missed ItBitcoin ATM Operator Indicted in New York Allegedly Running Illegal Business Attracting Criminals


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