Although other cryptocurrencies have slowed down and others have crashed in May, Tron has had a great month.

The TRX token is priced at $0.081, which is about 30% higher than its lowest point this month. As a result, its overall market capitalization has increased to around $7.6 billion, placing it as the 13th largest coin globally.

Tron’s accomplishments in May

In May, Tron’s ecosystem has expanded rapidly. This may be viewed as a measure of the DeFi ecosystem’s performance. According to DeFi Llama, Tron’s total value locked has nearly tripled to over $5.6 billion. 

The popularity of the coin has increased over the years, and because of that, it’s become a major player in the market. It’s currently ranked third by market capitalization after Ethereum and Binance Coin.

The most outstanding projects within its ecosystem are JustLend, JustStables, and SunSwap. As a result, investors now feel that the ecosystem has growth potential.

The Tron price has performed creditably this month due to the launch of a stablecoin named USDD.

According to CoinGecko, the USDD token rose from zero to over $576 million in value in less than 24 hours. This places it among the top 89 cryptocurrencies in terms of market capitalization.

The price of TRX has also benefited from the USDC airdrop that took place on February 11.

TRON holders were given free USDT, which helped to push up the TRX price. However, it’s worth noting that USDT is not fully backed by USD, so there’s still some risk involved.

However, USDD is the most significant hazard to Tron’s ecosystem. USDD is an algorithmic stablecoin that appears to be a UST clone. It has no real backing like the US dollar. Its stability instead relies on algorithmic rebalancing.

This means that if the TRX price falls, USDD will be sold off to buy TRX and drive up its price. This could create a death spiral for TRX, as investors lose confidence in the cryptocurrency and sell it off.

Therefore, USDD is exposed to the same threats that UST and Neutrino were before. To put it another way, if the stablecoin fails, investors will lose all of their tokens since there are no assets behind it.

This is why TRON has now decided to delist USDD from its exchanges. TRX holders should be grateful that the TRON Foundation is taking this step to protect them from a potentially disastrous stablecoin.

Tron price forecast

Data Source: Tradingview

On the four-hour chart, we notice that lately, the TRX price has been in a strong upward trend.

This resurgence has been bolstered by the 25-day and 50-day moving averages. It has also challenged the key support level at $0.0800, which was set on March 31st as the previous highest peak.

The 25-day moving average has acted as a support level since the TRX price reached it on April 3rd. The 50-day moving average has also been acting as a support level since the TRX price hit it on March 31st.

The cup and handle formation on the weekly chart indicates a potential bullish continuation. As the coin is forming a cup and handle pattern.

As bulls approach the key resistance level of $0.09 on the upper side of the cup, there’s a chance that it will rise even further.

The TRON Foundation has announced that it will be airdropping 30 million TRX to the community. The move is aimed at attracting more users and increasing the adoption of the TRON protocol.

This is a good move by the TRON Foundation, as it will help increase awareness about TRON and its native currency, TRX.

Therefore, if you’re thinking of investing in Tron, be aware of the risks involved. USDD is a significant threat to TRON’s recovery.

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James Atkins

I have been writing copy for blockchain-related projects since 2017. I understand the importance of being able to communicate clearly and effectively with both technical and non-technical audiences. By leveraging my understanding of the crypto industry trends, I can help increase adoption in this rapidly evolving landscape.