Justin Sun: “I learned a lesson from the Terra collapse and will not make mistakes with USDD.” – Bits Media

The founder of the Tron cryptocurrency project spoke about the risks, influenced the collapse of the Terra project, and shared plans for the Tron USDD stablecoin.

In his publication, Justin Sun (Justin Sun) told details about the decentralized stablecoin USDD, secured TRX and US dollar. Sun has quite ambitious plans for USDD - the businessman intends to make it a “new settlement currency”. Для стимулирования внедрения и увеличения предложения USDD, этот стейблкоин с лихвой обеспечен стабильными и волатильными активами, уверяет основатель Tron. According to San, неорганический и неустойчивый рост нарушают работу любой экосистемы, тогда как прозрачное чрезмерное обеспечение имеет решающее значение, preventing the stablecoin from being decoupled from the US dollar.

The head of Tron explained, that the Anchor lending protocol was involved in the collapse of the UST and LUNC rates. It attracted UST deposits worth more than $14 billion, which was the main reason for the explosive growth of UST. However, it was precisely this unsustainable growth that brought the Terra project out of balance., which subsequently led to the collapse. Besides, the creation of the Luna Foundation Guard to diversify UST collateral and prevent it from being decoupled from the US dollar was an overdue decision. The reserve consisted of BTC in the amount $3 billion, which was insufficient to secure a UST supply of almost $19 billion.

San assured, that USDD collateral will be transparently displayed on the project's backup site. The Tron DAO Reserve Foundation has already allocated for this $550 million and plans to increase reserves as USDD supply grows. Besides, the fund will establish liquid USDD trading pairs with DeFi and CeFi tokens in relation to USDD, which will be presented on centralized cryptocurrency exchanges and for which automated market makers will be used (AMM). San added in conclusion, that USDD now operates on Tron blockchains, BNB Chain and Ethereum, and in the future this list will expand.

According to Bloomberg, The market for algorithmic stablecoins is growing much faster than conventional stablecoins, because it is better "protected from control" by regulatory authorities.