TRON’s stablecoin, USDD, decoupled from the dollar
TRX price action held onto the negative as Justin Sun calmed down the community

USDD, the decentralized stablecoin of TRON [TRX], lost its peg to the dollar on Dec. 11, Eliosa Marchesoni revealed. The stablecoin, a product of Justin Sun’s ambition to make a widespread impact in the market, failed to recover.

According to Marchesoni, a tokenomics expert and adviser, the dip affected TRON’s collateral received and Crooked finances [CRV] swimming pool.

Read TRONs [TRX] Price prediction 2023-24

Is TRON taking the Kwon route?

This was apparently not the first time a stablecoin has broken away from the dollar. There were a few instances where Tether [USDT] did the same. For USDD, this was the first depeg since June 2022. The difference, however, was that USDT’s recovery was swift as it waited almost 24 hours. With the rocks hitting the market, it was natural for investors to be concerned.

In response to the depegging, TRON founder Justin Sun said USDD’s collateral was 200% and the community could access the information through a link he added to the tweet.

The founder went on to emulate Terra Luna [LUNA] founder Do Kwon’s tweet of “deploying more capital” to prove all was well with USDD. However, he attached proof adding more liquid assets to the reserves. Details of Ether scans transaction showed that Sun personally added approximately $1 million to the pool.

Source: Etherscan

After the input, CoinMarketCap showed that USDD’s volume Up 80% in the last 24 hours. Despite the increase, the stablecoin hovered around $0.97.

Responses to Sun’s tweet showed that quite a few investors didn’t see the humor in the “joke,” especially since it was something similar that influenced the market cap in June.

TRX: Unaware of whatever is happening

Anyway, TRX continued to hover around $0.05. At the time of writing, TRON lost 3.58% of the previous day’s value. Due to its price action, TRX had the potential to be negatively impacted by USDD’s shenanigans, as indicated by the Directional Movement Index (DMI).

Based on the four-hour chart, the DMI revealed that sellers had the upper hand. This was because the -DMI (red), at 26.16, dominated the +DMI (green), which was well below 8.99. In addition, the Average Directional Index (ADX) supported a comprehensive check by the seller.

At the time of writing, the ADX (yellow) was 27.33. A simplification of the projection was due to the indicator being above 25. In a situation like this, the ADX signaled strong directional movement. In addition, the Money Flow Index (MFI) has recently suggested a limited flow of liquidity.

Source: TradingView





This post TRON stablecoin USDD loses dollar peg amid Sun’s capital stake, but TRX floats

was published first on https://ambcrypto.com/tron-stablecoin-usdd-loses-dollar-peg-amid-suns-capital-deploy-trx-floats/

Author

Write A Comment