The crisis in Celsius, a popular lending platform, continues to affect the DeFi and crypto space. However, prominent people in the field are trying to prevent price drops and liquidations. In this context, the last move came from Tron founder Justin Sun. Sun has set aside $2 billion in funding to counter shorts in the TRX ecosystem. The funds will come out of TronDAO’s reserve. Sharing on Twitter, Justin Sun lashed out at the shorts. “They can’t even last 24 hours, the end of short-sellers is very near,” Sun said.
Tron founder broke his silence during the Celsius crisis
In fact, the famous crypto developer was pretty quiet during the bull market of 2021. But now, in the midst of the Celsius crisis, he has made a breakthrough. The founder set aside $2 billion from TronDAO’s fund reserve. The fund will be used to combat shorts in the Tron ecosystem. Justin Sun suggested that there was too much short selling on Binance exchange based on Tron’s native cryptocurrency TRX. Accordingly, the TRX short funding rate on Binance has hit 500%. TRX inventor continued his words on the subject as follows:
“$2 billion will be spent from TronDAO reserve to counter open positions. They can’t even last 24 hours. The shorts are coming to an end.”
Tron’s stablecoin is losing its stability
As we have reported as Kriptokoin.com, Tron has recently issued a stablecoin to USD dollar. This cryptocurrency, called USDD, followed the price of the dollar at a ratio of 1:1. Recently, however, there has been a drop in the stablecoin’s price against the US dollar. Accordingly, USDD started trading below $0.98 in the morning. Additionally, the stablecoin soon recovered and continued to follow the dollar at a 1:1 ratio. At the time of writing, Tron’s stablecoin was trading with a price tag of 0.997 in dollar terms. USDD is seen by cryptocurrency experts as a copy of Terra’s collapsing stablecoin UST. Therefore, the loss of stability of the cryptocurrency to the dollar is likely to trigger a large selling pressure. If that happens, it’s possible that TRX will see the same end as the LUNA.
Measures taken to prevent a new Terra event
USDD was launched at the end of May and took its place in the Tron ecosystem. Justin Sun talked about the new stablecoin after the LUNA crash. Sun claimed that USDD would be over-collateralized, thus avoiding an event like the UST. Additionally, TronDAO announced on Saturday that it added $50 million worth of BTC and TRX to its wallet. Accordingly, TronDAO is buying various cryptocurrencies and stablecoins to collateralize USDD. The DAO had previously announced to investors that the USDD collateral rate would be 130%. At the time of writing, this rate has reached 280%.
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