What is USDD? USDD is an algorithm-based stablecoin asset released to serve on the popular Blockchain network TRON. In this article, as Kriptokoin.com, we have answered the questions asked by investors such as what is USDD, what is it for, how to get it. Let’s take a look at this cryptocurrency designed to track the value of the US dollar.
What is USDD?
Stablecoins have become one of the star players in the cryptocurrency market. Some of these assets are among the top 5 cryptocurrencies. Tether, for example, is third on the list by market cap. These stablecoins have become the preferred way of transferring assets securely. But these entities had a fundamental problem: the problem of centralization. With the growing popularity of DeFi, there has been tremendous pressure and need for a more decentralized stablecoin.
In the simplest terms, a decentralized stablecoin is a cryptocurrency that fixes its price through algorithms. Universal Dollar, TerraClassicUSD and USDD are among such cryptocurrencies. USDD, which stands for “US Decentralized Dollar”, was launched by TRON and other Blockchain players on May 5, 2022. This is an algorithmic and decentralized stablecoin project mainly used on USDD’s TRON network.
What does USDD do?
USDD, the fully decentralized stablecoin launched by TRON, follows the US dollar. Accordingly, the price of the asset is always the same as the US dollar in a 1:1 ratio. However, the asset is not based on dollar reserves held by central institutions. Instead it uses algorithm to peg to USD. Algorithmic stablecoins operate in a much more decentralized way, as they do not require centralized financial institutions. This is an extremely important issue for cryptocurrency investors.
TRX, TRON’s altcoin asset, is used as the base currency pricing USDD. TRX works like USDD’s hedge against price fluctuations. However, the stablecoin is also used for a number of purposes, such as rewarding network participants who make long-term contributions. Users can make payments such as gas fees within the network with USDD. In addition, with stablecoin, they can avoid the risks in the cryptocurrency market.
What is USDD? How to take
Investors who want to buy USDD need to do a risk analysis first. Algorithmic stablecoins began to fall out of favor following the May 2022 crash of Terra (LUNA). This event came as TerraUSD lost its peg to the dollar, leading to the same thing happening with many algorithmic stablecoins. There does not appear to be such a problem in USDD at the moment, but investors should be careful. Investors who are considering buying can access this cryptocurrency through exchanges such as MEXC, Bybit and Bitrue.
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