Founder of TRON, H.E. Justin Sun, announced the launch of USDD, a decentralized USD stablecoin in an open letter on Twitter.
As per the open letter, TRON DAO (decentralized autonomous organization) has collaborated with other blockchain industry leaders to launch USDD.
USDD will apply the power of mathematics and algorithms to strive for financial freedom for all. The network will provide custody service for the $10B worth of highly liquid assets raised from blockchain industry initiators.
A TRON DAO Reserve would also be established to ensure the sustainable development of USDD.
First, USDD will be issued as a TRC token on the TRON network. The TRON DAO Reserve will then be used as a transparent tool to handle the reserves backing the USDD. The reserve will have a risk-free interest rate of 30% per annum.
USDD will not be dependent on centralized institutions for redemption, management, and storage. On the contrary, USDD will achieve full on-chain decentralization. It will be pegged to the underlying asset, TRX, and issued in a decentralized manner.
Thus, when USDD’s price is lower than 1 USD, users and arbitrageurs (investors who attempt to profit from market inefficiencies) 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 then receive 1 USDD.
Irrespective of market volatility, the USDD protocol will keep USDD stable at 1:1 against the US dollar through proper algorithms in a decentralized manner.
The decentralized currency protocol with a stable price will considerably expand the use cases of crypto. This in turn, will make it truly accessible with wide indications for the blockchain industry and also the economy.
Since its inception, TRON has witnessed over 87 million on-chain users and 3 billion transactions on its network. The circulating supply of TRC-20 USDT at 41 billion is more than that of ERC-20 USDT. This makes TRON the world’s largest stablecoin network.
Last year, the TRON had turned entirely decentralized. It was re-established into the TRON DAO, the world’s largest DAO. At that time, Justin was appointed by Grenada as its Ambassador at the WTO for which Justin even stepped down from the Tron.
USDD on TRON is the building block for developing TRON-based stablecoins and also a ‘giant leap for mankind’ in the path of ultimate financial freedom.
The open letter concludes, “Our 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.”