• The first over-collateralized decentralized stablecoin is USSD, which has a guaranteed minimum collateral ratio of 130 percent.
  • With almost $1.4 billion in assets in the Tron DAO reserve account, the current collateral ratio is over 200%.

The first overcollateralized decentralized stablecoin (OCDS), TRON-based USDD, has reached another milestone, becoming the industry’s first overcollateralized decentralized stablecoin.

The move comes in the wake of the recent demise of TerraUSD. Which was a centralized stablecoin that was backed by a consortium of South Korean banks.

A month after launching on May 5th, USDD has had excellent organic growth as part of its 3.0 Stablecoin project. And this latest upgrade introduces users not only to fast transactions but also to the market’s greatest collateral ratio.

This is thanks to the TRON network’s high TPS (transactions per second) and low transaction fees. USDD’s over-collateralization ratio is currently at 205%, which is significantly higher than the 150% industry average.

With this upgrade, TRON is once again leading the way in stablecoin innovation and development.

Because of the upgrade that permits TRON DAO Nominated members to burn TRX and generate USDD by doing so.

As well as improve the credibility and stability of the stablecoin via a mechanism. That allows assets in the TRON DAO Reserve to be over-collateralized (TDR).

Almost $1.4 billion in assets and 200% over-collateralized

Bitcoin (BTC), Tron (TRX), and top stablecoins including Tether (USDT), USD Coin (USDC), TrueUSD (TUSD), and USDJ are all over-collateralized assets.

According to available information on the Tron blockchain explorer TRONSCAN, USDD’s present flowing fund is just over 667 million.

The tokens have an assured minimum collateral ratio of at least one hundred and thirty percent. Which exceeds the DAI’s 120 percent threshold. 

The minimal ratio of 130% implies that all USDD token is funded by $1.3 worth of the above assets. The proportion stands at over 200 percent presently, with over $1.37 billion in various assets backing the USDD.

The reserve account currently keeps 10,500 BTC, 240 million USDT, and 1.9 billion TRX. In addition, a total of 8.29 billion TRX was sent to the burning contract.

TRON’s USDD is a stablecoin that is pegged to the US dollar. The token was launched in early 2019 on the TRON network. The token is backed by a reserve of assets that are used to stabilize its value.

USDD’s increase after TerraUSD crash

The USDD is fast becoming the dominant decentralized stablecoin, with circulation on the TRON network, Ethereum, and Binance Chain. The coin is also employed on other platforms as well as exchanges Poloniex, Huobi Global, KuCoin, and Bybit.

The value of USDD has seen a significant increase since the crash of TerraUSD. The price of TerraUSD fell sharply after it was revealed that the stablecoin was not backed by real assets. This led to a loss of confidence in the token, and its price crashed.

It’s also on SUN.io, PancakeSwap, Uniswap, and Curve, among other decentralized finance (DeFi) platforms.

Nonetheless, the crypto market’s trust in the algorithmic stablecoins was damaged following the severe collapse of TerraUSD (USD).

The stablecoin, which was based on over 80,000 BTC and other assets, collapsed and crashed the LUNA price alongside it. 

According to Justin Sun, the USDD is superior to UST and is “leading the Stablecoin 3.0 era.” He believes that the upgrade includes features that support the stability of the stablecoin.

He adds:

The $10 billion reserves pledged by the TDR will enable USDD to become the most reliable decentralized stablecoin with the highest collateral ratio in blockchain history. Currently, the 200%+ collateral ratio offers USDD a very strong safety net.”

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.