Justin Sun's algorithmic stablecoin USDD has officially expanded to the Ethereum network, marking a strategic move beyond its native TRON blockchain. The launch, accompanied by an exclusive airdrop campaign offering up to 12% APY rewards, aims to capture market share in Ethereum's $165 billion stablecoin ecosystem—the largest DeFi network globally.
The deployment features a Peg Stability Module enabling 1:1 swaps with USDT and USDC, backed by a CertiK audit. However, USDD faces significant challenges: its circulating supply has shrunk to $460 million (from $750 million a year ago), and its collateral structure remains heavily dependent on TRX tokens after the removal of $726 million in Bitcoin reserves in August 2024. Independent ratings agency Bluechip assigns USDD an "F" grade due to estimated collateralization of only 53%, far below industry standards.
Despite these concerns, the multi-chain expansion spans 10 networks including BSC and Polygon, supported by cross-chain bridges. The launch coincides with TRON's ecosystem growth, including SunSwap's $3 billion monthly volume and a 23% rise in JustLend borrowing transactions.
USDD enters a highly competitive landscape dominated by Tether ($169 billion market cap) and USDC. Tether processes over $24.6 billion daily on TRON alone, while Binance holds 67% of all exchange stablecoin reserves ($44.2 billion). Regulatory developments like MiCA and the U.S. GENIUS Act may create opportunities for compliant alternatives, with Citigroup projecting the sector could reach $2 trillion market cap by 2030.
