TRON DAO Announces USDD 2.0 Upgrade with 20% Annual Yield

TLDR

• Justin Sun announced USDD 2.0 with a 20% APY, fully backed by TRON DAO’s reserves, stating they can offer this rate because “we have plenty of money”
• USDD currently has a $746 million market cap, significantly smaller than market leaders USDT ($137 billion) and USDC ($45 billion)
• The stablecoin previously offered 30% APY when launched in May 2022 before reducing rates due to market conditions
• The launch timing coincides with a bull market phase and the upcoming Trump presidency
• Other stablecoins offer varying yields: Ethena’s USDe at 11%, DAI at 12% on Spark protocol, and USDC at 4.1% on Coinbase Wallet

TRON founder Justin Sun announced today the launch of USDD 2.0, a revamped version of the platform’s stablecoin, offering users a 20% annual percentage yield (APY). The new iteration comes with full backing from TRON DAO’s reserves.

Sun made the announcement on X (formerly Twitter), stating the reasoning behind the high yield offering: “All interest will be sent in advance to a transparent address. There’s no other reason—it’s simply because we have plenty of money.”

USDD 2.0 is about to launch with a 20% APY, fully subsidized by @trondao . All interest will be sent in advance to a transparent address. There’s no other reason—it’s simply because we have plenty of money. So, stop asking me questions like “where does the yield come from.”

— H.E. Justin Sun 🍌 (@justinsuntron) January 15, 2025

The original USDD launched in May 2022 on the TRON blockchain as a decentralized stablecoin. At launch, it offered users a 30% APY, but market conditions later forced a reduction in these rates.

USDD currently maintains a market capitalization of $746 million. The stablecoin primarily trades on decentralized exchanges within the TRON ecosystem, along with centralized platforms including KuCoin, Bybit, and Gate.io.

In comparison, the stablecoin market remains dominated by larger players. Tether (USDT) leads with a market cap of $137 billion, while USD Coin (USDC) holds second place at $45 billion, according to current CoinGecko data.

The timing of USDD 2.0’s launch aligns with what many consider the later stages of a bull market. Some market observers suggest this upward trend could strengthen following Donald Trump’s scheduled return to office on January 20.

TRON’s move places USDD among the highest-yielding stablecoins in the market. Current competitors include Ethena’s USDe, which recently reduced its yield from 20% to 11% APY.

Other options in the market include DAI, offering 12% APY through the Spark protocol, while USDC provides a more conservative 4.1% APY for deposits made using Coinbase Wallet.

The high-yield strategy brings memories of past market events. In 2022, Anchor Protocol on the Luna blockchain offered similar high yields for its UST stablecoin before its collapse, which resulted in $40 billion in losses.

TRON DAO aims to differentiate USDD 2.0 through its reserve backing. The organization states that all yields will be paid in advance to transparent addresses, allowing users to verify the availability of funds.

Trading of USDD 2.0 has begun across various platforms. Users can access the stablecoin through both decentralized exchanges on TRON and major centralized trading venues.

USDT’s recent market cap decrease from $140 billion followed the implementation of Europe’s Markets in Crypto Assets (MiCA) regulations, highlighting the impact of regulatory changes on stablecoin markets.

The stablecoin operates primarily within the TRON ecosystem, where it serves as a key component of the platform’s decentralized finance offerings.

Market participants can track USDD’s reserve backing through public blockchain addresses, providing transparency for the yield program’s funding.

The launch represents TRON’s renewed push into the stablecoin market, as it competes with established players for market share and user adoption.