On the 27th of July, Yahoo finance hosted an interview with Justin Sun, the founder of the Tron network. In the Video dialogue, Justin Sun claimed that USDD is safe for users, as the use of the token is not restricted by bank rails.
USSD has been applauded by Justin Sun for being decentralized. However, the token has struggled to maintain its peg on several occasions.
The USDD token was introduced to the Tron ecosystem sometime in May, shortly after the infamous UST crash. Following the sensitive timing of the release, Justin Sun was heavily bashed for trying to kick off another “Ponzi,” as Terra’s UST was tagged.
Justin Sun Defends USDD
Justin Sun, however, defended USDD, claiming it was secure and would be very different from LUNA and UST. Notably, both UST and USDD are algorithmic stablecoins. Unlike many other stablecoins backed by cash reserves and linked with centralized entities, algorithmic stablecoins are completely decentralized.
While UST was backed by LUNA’s supply, which triggered the eventual downfall of the token, USDD is backed by multiple decentralized assets like Bitcoin, Ethereum, and Tron.
Justin Sun also noted that a high-risk appetite triggered the loss of billions incurred by big crypto companies. The blockchain veteran discouraged using high leverages, emphasizing that the effects could be weighty.
Celsius Network, Three Arrows Capital, and Voyager Digital are some of the crypto institutions that have been negatively affected by leverage trading in the past three months.
Justin Sun believes the Tron ecosystem has learned from the flaws of these industry giants, and USDD will be able to survive unfavorable market situations. USDD has 300% collateral, and the token boasts a market capitalization of $725 million. Currently, USDD is valued at $0.99, not so far from the perfect $1 mark.
