The algorithmic stablecoin USDD of the Tron network lost its parity with the U.S. dollar on the 13th and once fell to a minimum of $0.91. As of writing, it fell 1.7% to $0.978534. As the overall cryptocurrency market plummeted, Mainly, investors are increasingly concerned about stubbornly high inflation, tightening financial conditions and a possible recession.
Justin Sun, the founder of Tron, tweeted on the same day that the financing rate of the cryptocurrency exchange Binance for shorting the Tron blockchain’s native token TRX was “negative 500%”. Such an amazing interest rate means that many investors want to conduct such a transaction. . According to Justin Sun, TronDAO “will spend $2 billion against them.”
Justin Sun also said: “I don’t think they (the bears) can survive 24 hours. The short squeeze is coming.”
TronDAO tweeted that it had added $650 million in USDC to its reserves.
USDD (full name Decentralized USD) is Tron’s algorithmic stable currency, a multi-purpose smart contract blockchain, originally assumed to have a 1:1 exchange rate with the US dollar. It relies on an elaborate, automated balancing mechanism involving the alternative creation and destruction of USDD and TRX tokens.
USDD is also backed by a basket of cryptocurrencies, such as TRX, Bitcoin, and other stablecoins including Tether’s USDT and Circle’s USDC, as a reserve fund for the Tron DAO Reserve.
Its design is very similar to Terra’s algorithmic stablecoin UST. UST only lost its value parity with the US dollar a month ago and eventually imploded, wiping out $40 billion in market value.
One of the main reasons for the collapse of the cryptocurrency market on the 13th was that the cryptocurrency lending platform Celsius announced that it would suspend deposits and transactions to avoid a run on deposits. This is the latest liquidity crisis in the cryptocurrency space, mainly caused by a deteriorating global economic environment, as major central banks continue to raise interest rates and drain liquidity from the financial system to combat persistently high inflation.
According to TradingView, USDD fell to $0.91 on the KuCoin cryptocurrency exchange on the 13th, which is a 9% drop from the value of $1 that should have been pegged.
According to the official website of TronDAO, the guaranteed funds of USDD are maintained at 2 billion US dollars. As for the supply of USDD in circulation, it is 723 million US dollars, which means that there are enough funds to use the reserves to buy USDD to boost the stablecoin. value.
On the other hand, USDD’s sister token TRX has lost 5.7% in the past 24 hours.
Top Market Updates and News Portals:
Blockke is committed to exploring and sorting out various content related to blockchain technology, as long as there is cooperation and/or suggestion related to the block chain or the blockke website, we are very welcome.Please email to [email protected] contact us.