Tron’s USDD Stablecoin Has Been Under a Dollar For a Week

The newly released Tron stablecoin USDD, is currently trading under a dollar, a price it has crept below since depegging on June 13th.

On June 19th USDD reached an all-time low of $0.9255, at the time of writing the former stablecoin trades at $0.9608, according to data from CoinMarketCap. A stablecoins intended value is always a dollar, USDD presently sits a couple of cents lower.

The Tron DAO Reserve claimed on Twitter that USDD was not depegged, on June 17th. “USDD is a decentralized stablecoin that depends on an on-chain mechanism & collateralized assets,” the tweet claims. Continuing it argues that USDD is different from centralized stablecoins like Circles USDC in not being attached to the dollar “in a very close spread by banking mint and redemption.

Initially, USDD depegged due to short-sellers attacking its network native token TRX, on the crypto exchange Binance, according to Tron's founder Justin Sun. Even with Sun's pledge of $2 billion from the Tron DAO Reserve, in an attempt to combat the short-sellers, the coins sadly still sits below a dollar.

Earlier today the Tron DAO Reserve announced that it had bought 10,000,000 USDD in an attempt to “safeguard the overall blockchain industry and crypto market.”

What is USDD?

USDD was originally released as an algorithmic stablecoin, the coin would change to a hybrid model after the fall of Terra's own algorithmic stablecoin UST. The stablecoin is now backed by Bitcoin, TRX, USDT and USDC reserves.

The overall value of all USDD coins is just over $723 million, according to the Tron DAO Reserve’s website, the currency is backed by $2.3 billion in collateral with a ratio of 324%.

Tron’s is an ecosystem that has been criticized by many within the space due to multiple decisions the company and its founder have made, this depegging of their stablecoin does not bode well for them, especially in these uncertain times.