TRON Increases Reserves As USDD Stays De-pegged

Profile picture
CoinGape
8w ago2022-06-17

TRON DAO has increased its stablecoin reserves to safeguard the blockchain as the USDD continued to trade below its peg. 

The reserve increased its supply of USDC tokens by 300 million on the blockchain. The current supply now sums up to $2.8 billion.

USDD, which was launched earlier this year, was intended to be an algorithmic stablecoin. But it then overcollateralized to prevent a crash like Terra’s UST.

Collateralization Rate Reaches 300%

With the increase in the reserve, the USDD’s collateralization rate has reached  324.53%. After the announcement, a marginal increase in the token price has been noticed.

At the press time, TRX is trading at an average price of $0.060. The token price has jumped by 1.57% in 24 hours.

TRON’s stablecoin is currently trading at $0.97. The price has increased by 0.19% in the last 24 hours.

This measure was taken to shield the USDD from further de-pegging.

The TRON token had experienced a fall of nearly 20% in its price earlier this week. The de-pegging of the stablecoin is believed to be one of the reasons behind this slump.

However, the token was recorded as the biggest gainer last month, largely due to the hefty 30% yield offered by USDD.

The blockchain has announced earlier that it will withdraw 3 billion TRX out of the Cefi exchange and Defi lending platform.

By doing these withdrawals TRON blockchain is trying to reduce liquidity for short sellers, closing their positions.

TRON Aims For $ 3 Billion reserve

Justin Sun, CEO of the blockchain has hinted that this $2.8 billion reserve will to stretch up to $3 billion. This is not the first instance when the millions have been added to the reserve with an aim to save its stabelcoin.

Earlier this month, another $100 million was injected into the reserve. This was the first transfer done by the TRON in order stop its stablecoin from meeting the fate of TERRA LUNA.

According to CoinGecko’s data ,USDD has recorded has recorded a growth of 126% in its market capital in past 30 days.

The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.