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The fall of Terra (LUNA) network is such an instance that someone within crypto space could hardly forget. Depegging of Terra’s algorithmic stablecoin UST resulted in collapse of the entire ecosystem. This further started a ripple effect for the whole crypto market. Not only it created a void within the space but also spread skepticism around cryptocurrencies all around the world. Newly launched USDD stablecoin of the Tron network appears to be surrounded by similar doubts.
Given the suspicion around USDD, founder of Tron network Justin Sun has to come forward in order to clear their stand. Justin Sun tried to project the difference of their decentralized stablecoin USDD from UST stablecoin of Terra network. He argued that the stablecoin is hybrid in nature that takes advantage of every possible asset within the market with backing of the US dollar.
Justin Sun stated that he thinks the stablecoin reflects characteristics of DAI, UST and similar stablecoins due to its hybrid form. The creators of USDD thoroughly went through the different decentralized stableocin’s algorithms and working. This made it possible for them to add all the benefits of different stablecoins into one, he added.
No Stable Coins on Bitcoin and Ethereum
Sun pointed out the flaws in major cryptocurrency blockchain networks Bitcoin (BTC) and Ethereum (ETH). He said that according to him the major issue with these blockchains is their lack of native stablecoins. He agrees with the fact that although Bitcoin could not employ a stablecoin due to absence of any smart contract ability but Ethereum can. It’s worth noting that different stablecoins including DAI is based upon Etheruem but it’s not native to the blockchain network.
Maker is the underlying infrastructure for DAI stablecoin. Ethereum provides the convenience to put ETH as collateral against minting DAI. However, when it comes to tokens to use within the governance structure, the stablecoin uses MKR.
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
