The creator of Tron, Justin Sun, recently announced the upcoming launch of the updated stablecoin USDD 2.0. One of the key innovations is the opportunity for users to earn 20% annual yield (APY). All interest will be subsidized by the project, with funds for these payments planned to be allocated in advance to a transparent address, aimed at increasing trust in the model.
Background and Issues with the Previous Version of USDD
The first version of the USDD stablecoin was launched in May 2022 and immediately attracted attention due to promises of 30% annual yield. However, the project faced significant challenges in practice. One of the main problems was the loss of its peg to the US dollar, which undermined user trust and led to the removal of the asset from major cryptocurrency exchanges. Initially, the stablecoin was backed by Bitcoin (BTC), but this scheme proved unstable. To stabilize the asset, the reserve was switched to Tron’s native token — TRX. Nonetheless, this step failed to fully resolve the issues.
Community Skepticism
The announcement of the new stablecoin comes with promises from Justin Sun that sufficient funds will be available to ensure the declared yield. However, many members of the crypto community are skeptical about the sustainability of such a financial model. Key concerns include:
- The source of funds for paying high yields.
- The long-term profitability of the project, especially given past experiences.
- Risks for users in the event of potential market fluctuations.
Conclusion
USDD 2.0 is an ambitious attempt to rekindle interest in Tron’s stablecoin. The declared 20% annual yield looks attractive but raises questions about the reliability and sustainability of the project. Investors are advised to approach this asset cautiously, thoroughly analyze the proposed conditions, and closely monitor developments surrounding the project.
