Crypto News

TRON DAO pledges $2 billion to protect TRX after LUNA crash

After Terra dropped out in the last few days because of his stablecoin hit the news, Justin Sun assured that the TRON DAO Reserve plans to spend $2 billion to counter potential attacks TRX provide, which seems to be the next goal after LUNA.

  • For the past week or so, all eyes in and out of the crypto community have been on Terra and its two natives cryptocurrencies – LUNA and UST – directed. When CryptoPotato As summarized earlier, UST, a stablecoin that was supposed to be pegged 1:1 to the USD, lost this peg and its price fell to a low of $0.2 on Binance.
  • Being an algorithmic stablecoin with new tokens issued when users burn LUNA and vice versa, this massive crash allowed speculators to get out of the situation arbitrage to capitalize.
  • This resulted in an overwhelming price drop for LUNA, which is trading at $1.15 at the time of writing. That means the token has lost around 98% of its value in less than a week.
  • Due to some similarities in how the Terra and TRON stablecoins (both algorithmic) work, Justin Sun warned that his project could be the next target of similar attacks.
  • Taking it to Twitter to outline the potential threat, he said that the funding rate of shorting TRX on Binance exceeded 100% APR, later updating that the percentage had risen to nearly 400%.
  • However, Sun assured that the TRON-DAO reserve plans to deploy $2 billion to fight against something similar happening with his project as happened with Terra.
  • Sun also noted that USDD (unlike UST) has remained “very stable” amid recent market volatility. Furthermore, he said USDD has a total market cap of $271 million while TRON DAO reserve holds $10 billion.

#USDD remains very stable in today’s market volatility. Currently, the total cap of #USDD is $271 million and the total reserve in @trondaoreserve is $10 billion.

— SE Justin Sun (@justinsuntron) May 11, 2022

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Source: Crypto News Deutsch

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