Tron founder, Justin Sun, believes that TRON and its stablecoins might be the next target, following the recent events with Terra and UST coins.
Terra Faces A Failing Stablecoin
Terra has been in the news recently, and people are talking about its failing stablecoin, which could be used as a hedge fund against inflation. However, Justin Sun announced that the Tron DAO Reserve would allocate $2 billion to manage potential attacks against the coin, as Justin believes TRX is the next target after LUNA and UST.
At the moment, UST, which is supposed to be tied to USD in a 1:1 ratio, lost the peg and dropped to $0.2 on Binance.
Unfortunately, every time users burn LUNA, new tokens are launched in connection with UST, and this crash allowed traders to benefit from arbitrage. LUNA then dropped further, trading at about $1.15 at the moment, losing 98% of its value in less than one week.
Since Tron and Terra are somewhat similar, Justin decided to protect his project from these types of attacks. Sun noted that USDD is stable so far, even with the latest market volatility. The USDD has a total market cap of $271 million, and Tron DAO holds $10 billion in reserves.