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

Many eyes are now on Tron-based stablecoin USDD, after the Terra UST collapse and current volatility in the crypto markets. 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. The stablecoin USDD also fell to $0.977 an unit on Monday during crypto market chaos.

Another Stablecoin Wobbles, While the Crypto Economy’s Value Drops Massively — Tron DAO Reserve Deploys USDC to Defend USDD Peg

One of the darkest Mondays in crypto asset history saw the USDD stablecoin fall to $0.97/unit and Tron DAO Reserve was forced to use funds to protect the $1 parity. “For the market extreme condition, [Tron DAO Reserve]Has received 700,000,000 USDC in defense [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]They will spend 2 billion dollars to combat 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

Tron DAO Reserve made a few purchases in order to preserve the peg. The 700 million USDC purchase was completed. boughtAdditional 100 Million USDC another 100 millionAfter that, more USDC.

“Currently USDC supply on TRON has reached $2.5 billion,” the Tron DAO Reserve remarked after adding 650 million USDCThe 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.

How do you feel about Tron’s USDD stablecoin and the fight it is having against market violence? Please comment below to let us know your thoughts on this topic.

Jamie Redman

Jamie Redman, a Florida-based financial journalist and news lead at Bitcoin.com News is Jamie Redman. Redman is an active participant in the cryptocurrency community from 2011. Since 2011, Redman has been an active member of the cryptocurrency community. Redman is a prolific writer for Bitcoin.com News, with over 5,000 articles on disruptive protocols.