Justin Sun Plans a Tron Stablecoin With $10 Billion of Crypto Collateral
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Tron founder Justin Sun has announced plans to launch a decentralized algorithmic stablecoin called USDD on the TRON blockchain network.
- In an open letter on Thursday (April 21, 2022), Sun revealed that USDD will be “a fully decentralized stablecoin underpinned by mathematics and algorithms.”
- According to the Tron founder, USDD will not rely on any centralized entity for storage, redemption, or management but will be instead issued in a decentralized manner and will be pegged to Tron’s native token TRX. An excerpt from the letter said:
“When USDD’s price is lower than 1 USD, users and arbitrageurs can send 1 USDD to the system and receive 1 USD worth of TRX. When USDD’s price is higher than 1 USD, users and arbitrageurs can send 1 USD worth of TRX to the decentralized system and receive 1 USDD.”
- Sun added that the stablecoin’s algorithm will maintain its stability against the US dollar despite market volatility.
- Furthermore, the open letter noted that the TRON DAO reserve will offer a risk-free interest rate of 30% per annum and will also provide custody service for $10 billion in highly liquid assets.
- The fund, which will be “raised from initiators of the blockchain industry,” will act as a reserve to keep the stability of USDD.
- While the cryptocurrency assets are not mentioned, the plan seems similar to Do Kwon’s, co-founder and CEO of Terraform Labs, who is looking to purchase $10 billion worth of bitcoin as a reserve for UST.
- Meanwhile, Sun announced that the TRON-based USDD is expected to be issued and circulated beginning on May 5, 2022. The decentralized stablecoin will be available on Ethereum and the BNB chain via the BTTC cross-chain protocol.
Read more: https://cryptopotato.com/justin-sun-plans-a-tron-stablecoin-with-10-billion-of-crypto-collateral/
Text source: CryptoPotato
