Summary:
- Tron’s Justin Sun has announced the launch of an algorithmic stablecoin backed by TRX
- Known as USDD, the stablecoin will be decentralized
- Tron’s USDD will be launched on May 5th, 2022, and be available on Ethereum and the Binance Smart Chain
- Justin Sun’s plans for a stablecoin backed by TRX are similar to Terra’s UST backed by Bitcoin and Avalanche (AVAX)
The Founder and former CEO of Tron and now Ambassador and Permanent Representative of Grenada to the WTO, Justin Sun, has announced plans to launch a decentralized algorithmic stablecoin backed by TRX.
According to the official announcement by His Excellency Justin Sun, the stablecoin will have the ticker of USDD. Additionally, it will be launched on issued on the 5th of May this year and available on Ethereum and the Binance Smart Chain. The interoperability with the two additional blockchains will be made possible through the BTTC cross-chain protocol.
USDD will be Decentralized on Tron
Furthermore, USDD will ‘not rely on any centralized institutions for redemption, management, and storage.’ It will be fully decentralized on-chain and backed by Tron’s TRX coin. USDD will further be pegged to $1, as explained below by Justin Sun.
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. Regardless of market volatility, the USDD protocol will keep USDD stable at 1: 1 against the US dollar via proper algorithms in a decentralized manner.
Justin Sun Follows in the Footsteps of Terra with $10B in Reserves
The roadmap toward the launch of Tron’s USDD will consist of four stages named after humanity’s efforts toward space exploration. The four stages are 1.0 Space, 2.0 ISS, 3.0 Moon, and 4.0 Mars.
In addition, the management of USDD will be entrusted to the TRON DAO reserve and major blockchain institutions. The Tron DAO will be tasked with providing custody of $10 Billion ‘worth of highly liquid assets raised from initiators of the blockchain industry.’ The funds will be used as ‘early-stage reserve, keep the exchange rate of USDD stable, and enforce convertibility fully.’
Justin Sun’s plans of a USDD stablecoin backed by $10 billion in assets follow in the footsteps of Terra’s Do Kwon, who wants to back UST with $10 Billion worth of Bitcoin and other digital assets such as Avalanche (AVAX).
The end goal of USDD ‘is to make equitable access to financial services a fundamental human right.’ Justin also predicts that with time, ‘financial services will become a necessity like water and air, accessible to people worldwide.’
[Feature image courtesy of Justin Sun on Twitter]