Tron Founder Justin Sun Unveils Controversial New Product: “We’re Doing It Because We Have Too Much Money”

Tron (TRX) founder Justin Sun has announced the upcoming launch of USDD 2.0, the latest version of Tron’s algorithmic stablecoin that promises a remarkable 20% annual percentage yield (APY) that will be fully subsidized by the Tron DAO. In a post on X (formerly Twitter), Sun addressed doubts about the stablecoin’s source of returns, saying, “All interest will be sent to a transparent address in advance. There is no other reason, it’s just because we have plenty of money. So stop asking me questions like ‘what is the source of the return’.” USDD was initially launched in 2022 as a competitor to Terra’s now-infamous UST stablecoin. Unlike UST, which crashed amid market turmoil, USDD has survived but continues to be heavily backed by Tron’s native token TRX. USDD is reportedly governed by the Tron DAO, which oversees its collateral and operations. Related News: BREAKING: FED Publishes Critical Beige Book Report - Here's All You Need to Know Algorithmic stablecoins like USDD, which aim to be pegged to the US dollar using crypto-backed mechanisms, have faced criticism compared to their cash-backed counterparts like USDC and USDT. The stablecoin market, valued at over $215 billion, is expected to more than double by the end of the year, according to analysts. USDD has had its share of critics, including Bluechip, a platform that evaluates stablecoins. Last year, Bluechip gave USDD the lowest stability ranking, citing concerns about its reliance on TRX as a backing asset and the lack of a transparent governance system: “USDD has no governance system. USDD holders have no legal or code-based protection and are at the mercy of the Tron DAO Reserve.” The stablecoin’s website claims that USDD is secured by overcollateralization of mainstream digital assets like TRX and USDT, with a collateralization ratio of 120%. According to the site, USDD is backed by $2.6 billion in assets, the majority of which are TRX tokens. *This is not investment advice. Continue Reading: Tron Founder Justin Sun Unveils Controversial New Product: “We’re Doing It Because We Have Too Much Money”