- USDD, or the Tron-based decentralized dollar, is set to be the most over-collateralized stablecoin in crypto.
- The stablecoin currently boasts over 200% of its value is fully-backed.
After a month of pure stablecoin talk across the crypto ecosystem, with the failure of Terra’s stablecoin, UST, Tron ecosystem has announced its own stablecoin, the USDD (decentralized USD). According to a statement, the decentralized dollar has upgraded into the first over-collateralized decentralized stablecoin, with current collateralization levels way above 200%, with a guaranteed minimum collateral ratio of 130%. The stablecoin is backed by a basket of several assets including the dollar, Bitcoin, other stablecoins, and the native Tron token, $TRX.
The Tron-based stablecoin launched last month and has been constantly solidifying its growth in a bid to kick off the stablecoin 3.0 era that makes finance accessible to all. Speaking on the USDD becoming the most over-collateralized stablecoin in the crypto ecosystem, Justin Sun, founder of Tron said,
"Spearheading the Stablecoin 3.0 era, the upgraded, over-collateralized USDD will add more diversified features to underpin its stability.”
The stablecoin currently has a total circulating supply of 667,521,101.61 USDD, according to Coinmarketcap, with each USDD being over-collateralized, making it the first over-collateralized decentralized stablecoin (OCDS). The stablecoin will be used by crypto users across the decentralized finance (DeFi) ecosystem, offering faster and cheaper transactions.
As one of the most secure and decentralized stablecoins, USDD currently enjoys a guaranteed collateral ratio of at least 130%, with a public record published on the Tron DAO Reserves website, which updates in real-time. The USDD token can be minted by the Tron DAO Reserve members who are required to burn $TRX in the process. However, the upgrade consolidates USDD's stability and credibility by over-collateralizing assets under the TRON DAO Reserve (TDR). These reserve assets would include BTC, TRX, and multiple stablecoins like USDC, USDT, TUSD, and USDJ, at a ratio of 130% to back the issuance of USDD.
The Tron DAO Reserve
As mentioned above, the USDD stablecoin is maintained by the Tron DAO Reserve, which currently holds 14,050 $BTC, 240 million USDT, and 1.9 billion TRX in the reserve account, on top of the 8.29 billion TRX already in the burning contract. This brings the over-collateralization ratio of USDD to 225%, as of writing, or a total of ~$1.3 billion backing the $667 million USDD minted.
The USDD stablecoin lives on multiple chains with Tron, Ethereum and BNB Chain all allowing transfers of USDD. It’s also embraced by numerous popular platforms, including SUN.io, Uniswap, PancakeSwap, Curve, Ellipsis, KyberSwap, Poloniex, Huobi Global, KuCoin, Gate.io, and Bybit. Industry leaders such as Alameda Research, Amber Group, Poloniex, Ankr, Mirana, Multichain, FalconX, and TPS Capital have already joined the TDR membership as a whitelisted institution, with more names soon to be announced.
“The $10 billion reserves pledged by the TDR will enable USDD to become the most reliable decentralized stablecoin with the highest collateral ratio in blockchain history,” Justin added. “Currently, the 200%+ collateral ratio offers USDD a very strong safety net."
Tron blockchain has witnessed wild growth in the last few years as innovative products are launched on the blockchain, which offering sub-cents transaction fees. Led by the Tron DAO, Tron has registered over 96 million user accounts, over $55 billion worth of assets stored on-chain, and an average daily transaction value of $10 billion across the network.
As adoption rates boost in the near future, the USDD stablecoin will sought to embrace additional blockchain ecosystems and major decentralized applications (DApps), the team statement concluded.
Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice