Tron Modifies USDD Stablecoin to Avoid Terra-Style Collapse
Tron, which debuted the USDD algorithmic stablecoin last month, is looking to avoid the trouble its fellow token TerraUSD ran into by boosting transparency and adding collateral.
Total USDD supply stands at about $668 million, the Tron DAO Reserve website and CoinGecko indicate.
USDD currently has a collateralization ratio of 206%, according to the TDR website, while a statement from the company on Sunday said a guaranteed minimum collateral ratio of 130% will be maintained.
TDR's site shows reserves in Bitcoin, Tether and Tron's TRX of $710 million, and a total $1.37 billion of assets backing the USDD in circulation, according to the statement.
The moves come just a few weeks after the Luna and TerraUSD ecosystem collapsed, all but erasing a combined market value that had once exceeded $60 billion.
“This has been in the plan, but Terra/Luna definitely accelerated and prioritized this for our team,” Tron founder Justin Sun said in a recent interview.
“We want to have USDD to be overcollateralized, which I think will make market participants more comfortable about using us in the future.”
Algorithmic stablecoins -- which are meant to stay at a constant price, often $1 -- have a troubled history.
Efforts such as Neutrino and Basis have lost their dollar pegs, some in spectacular fashion, after price declines in the stabilizing token.
Last month's implosion of Luna and TerraUSD caused further devastation to the cryptocurrency complex, which has struggled as the Federal Reserve hikes rates and inflation remains high.
Bitcoin and Ether, the two biggest tokens, are more than 50% lower than their November highs and many digital assets have down even further.
Sun said in an interview last month that the Terra/Luna collapse offered a chance for other projects to adjust, and that USDD would aim to raise $10 billion through TDR to defend its peg.
Tron has fared relatively well amid the efforts on USDD. In late April, the TRX token was the 24th-biggest by market cap. It now sits at the 13th spot, according to pricing from CoinGecko.
Sun said one of his takeaways on Luna and TerraUSD was the Luna Foundation Guard was very passive, and had a strategy to buy and sell Bitcoin that was “very easy to predict,” which would have made it easier to be attacked.
“Tron DAO will be very active in the market and less predictable,” he said in the recent interview. “You make the market feel comfortable, but without telling too much information.”
-
Talking Points This Week: Tech Nerves, FII Buying, And A Faraway Banking Shock
The global markets are not shining this Diwali. The exception in the large markets is, India.
-
Midterm Rally Lasted A Day. The Hard Reality Of A Divided US May Last Two Years | Opinion
Between a contested AI boom, a debt ceiling that arrives in 2027 and a president with every incentive to act alone, the next two years may prove more volatile than the first day's rally suggests.
-
Blue Wave Will Derail the AI Trade but Won't Dismantle the AI Era | Unhedged Position
The Democrats' sweep of the US Congress will see politics collide with economic forces both over the long and short term.
-
It's Time To Take The GST Council's Bet On Trust Global
Payment records can prove India's services exports, and clear, proportionate rules can bring foreign digital sellers into the tax net.
-
Opinion | India at 38: From Innovation Overperformer to Innovation Powerhouse
India now has 453 VC-backed deep science startups, 18 of them late-stage, after 117 percent growth since 2020. Laurus Labs, at USD 9.3 billion, is the most valuable deep science company in any middle-income economy outside China.
-
Navigating Energy Crossroads: S Jaishankar's Call For Diversified Supply Chains At G20 Ministerial Meeting
As geopolitical fault lines continue to test maritime trade routes and commodity flows, Jaishankar's message remains pertinent: true economic resilience requires open markets, protected transit lines, and a genuine commitment to multilateral cooperation rather than coercion.
-
Indians Are Travelling, But Not Every Journey Is A Holiday | The Week In Whys
Pilgrims, patients and working women are the real travellers, and the system hasn't quite caught up with them.
-
Getting To Work Costs Women More | The Reason Why
It is not just about women paying more than men. It is about women paying much more in cities than in villages.
-
AI Bias In Investing Cannot Be Eliminated, But It Can Be Governed
Framing is a particularly important example as identical financial information presented in terms of gains rather than losses can lead an LLM to reach a different assessment.
