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. pic.twitter.com/c9wwbBGsJx
— SE Justin Sun (@justinsuntron) May 11, 2022
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Source: Crypto News Deutsch