Justin Sun has announced that Tron will soon launch USDD 2.0, with the aim of creating a new version of the USDD stablecoin.
Sun has committed that this asset will provide users with a 20% APY, fully subsidized by Tron. However, the community remains cautious about the company's past failures, such as USDD 1.0.
Tron Launches USDD 2.0 with Lofty Promises
Justin Sun, the founder and former CEO of Tron, has announced USDD 2.0 on X. Although the company had tried to take precautions with the initial launch of this stablecoin, it later failed and was delisted from major exchanges.
Returning to 2022, USDD had provided a 30% APY, which later decreased due to market challenges. Most recently, in August last year, the Tron DAO Reserve withdrew around 12,000 Bitcoin from USDD's collateral assets without prior approval from its DAO.
This move has shifted the primary support of the stablecoin to Tron's native token TRX, raising concerns about the stability and transparency of this asset.
Most importantly, the stablecoin has repeatedly lost its dollar peg over the past two years. USDD remains a cautionary tale about Sun's failures in the community. Therefore, the community is not wrong to question the new project. However, the company is making another attempt.
Sun stated:
USDD 2.0 is about to launch with a 20% APY, fully subsidized by Tron. All the interest will be sent upfront to a transparent address. There is no other reason—we simply have a lot of money. So, stop asking me questions like "where does the profit come from".
To be fair, claims of a 20% APY on a stablecoin are concerning. Sun certainly controls significant capital sources; he invested $30 million in Trump's World Liberty Financial in late November. However, if Tron pays USDD users from its own cash reserves, it is unclear how the company will actually generate profits.
Tron's native token TRX has reached an All-Time-High about a month ago, but its volatility may not be sustainable enough to support a stablecoin. In fact, TRX has seen steady decline in recent weeks, although loyal investors are showing resilience.
FOLLOW US ON FACEBOOK | TELEGRAM | TWITTER
Disclaimer: All content on this website is for informational purposes only and is not investment advice. Readers should do their own research before making investment decisions. We are not responsible, directly or indirectly, for any damage or loss caused or alleged to be caused by or in connection with the use of or reliance on any content you read on this website.
