Justin Sun claims that USDD is the "truly decentralized stablecoin" and asserts that it carries no risk of being frozen or collapsing. He also promotes USDD 2.0 with an APY of 20%, fully subsidized by TRON DAO. However, Sun has not provided specific details about the improvements in the new version, causing concern within the community.
USDD 2.0 may adopt an over-collateralized stablecoin model, similar to USDJ, with collateral assets from Wrapped Tron, Tether, and CryptoFlow. Although USDD has a market capitalization of 742 million USD, it remains small compared to USDT (140 billion USD) and USDC (54 billion USD).
The 20% APY raises some concerns about risk, reminiscent of the collapse of UST in 2022. Regulations like the EU's MiCA have banned algorithmic stablecoins, posing a significant challenge for USDD in the future.
