H.E. Justin Sun, Founder of TRON, announced yesterday in an open letter on Twitter that an all-new stablecoin is launching on the TRON blockchain, USDD (or Decentralized USD), marking its official entry into the field of decentralized stablecoin.
TRON DAO will partner with other blockchain industry leaders to establish USDD. In another open letter, Sun mentioned that a TRON DAO Reserve would be established to ensure the sustainable development of USDD.
At the start, USDD will be issued as a TRC token on the TRON network. The TRON DAO Reserve will serve as a transparent mechanism to manage the reserves backing the USDD.
USDD will not rely on any centralized institutions for redemption, management, and storage. Instead, it will achieve full on-chain decentralization. USDD will be pegged to the underlying asset, TRX, and issued in a decentralized manner.
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.
Taken together, this decentralized currency protocol with a stable price will significantly expand use cases of crypto, making it truly accessible with far-reaching implications for the blockchain space and the real economy.
After four years of growth, TRON has seen over 87 million on-chain users and 3 billion transactions in its ecosystem. The circulating supply of TRC-20 USDT has exceeded that of ERC-20 USDT, standing at $41 billion, making TRON the world’s largest stablecoin network. In December 2021, the TRON network became fully decentralized and was restructured into the TRON DAO, the world’s largest decentralized autonomous organization (DAO).
The end goal is to make equitable access to financial services a fundamental human right. In time, financial services will become a necessity like water and air, accessible to people worldwide.