Altcoins News

Story: Justin Sun’s USDD Expands to Ethereum, Challenging Tether’s Stablecoin Dominance

By Maheen Hernandez

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Incentives, Peg Stability, and Collateral Backing. USDD is structured as an overcollateralized algorithmic stablecoin, originally developed on the…

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The Shadow of Tether’s Market Dominance. Competing with Tether remains the greatest challenge for USDD.

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Growing Competition in the Stablecoin Sector. While Tether dominates, the stablecoin landscape is broadening.

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Can USDD Secure Long-Term Adoption?. USDD’s expansion to Ethereum demonstrates ambition, but the road ahead is steep.

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USDD, the decentralized stablecoin created by Justin Sun, has made its way onto Ethereum, marking a new phase in the project’s development.

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USDD on Ethereum brings with it a Peg Stability Module (PSM), which allows direct swaps with USDT and USDC on a 1:1 basis.

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Despite Ethereum’s dominance in the stablecoin sector, USDD is still relatively small compared to Tether, which commands over $169 billion in circulation.

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USDD is structured as an overcollateralized algorithmic stablecoin, originally developed on the TRON network to maintain a soft peg to the U.S. dollar.

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The Peg Stability Module enables efficient swaps with USDT and USDC, improving liquidity for users and traders who want seamless entry and exit points.

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Justin Sun emphasized the importance of choice in the stablecoin market, stating that USDD provides a decentralized alternative alongside Tether and USD Coin.

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Collateralization remains a key topic for USDD. Current reserves reflect a 204.5% collateral ratio, mostly supported by TRX after Sun removed $726 million in Bitcoin collateral…

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Competing with Tether remains the greatest challenge for USDD. TRON alone processes between $23 billion and $25 billion in daily USDT transfers, while Ethereum handles around $20…

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On TRON, circulating USDT exceeds $80 billion, and Binance controls roughly $44 billion in stablecoins, representing two-thirds of its reserves.

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Liquidity on Ethereum has improved thanks to the PSM, but it still trails behind USDT and USDC in depth and reliability.

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While Tether dominates, the stablecoin landscape is broadening. MetaMask is preparing to roll out its own mUSD, Paxos has introduced USDH with revenue-sharing features, and…

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