Last updated on May 17th, 2023 at 11:56 am
What is meant by stablecoin?
Stablecoin is the most stable coin in the digital currency market than crypto. The purpose of it, a new form of cryptocurrency, is very reliable than others.
Others use algorithms and other methods to manage price volatility.
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Cryptocoin vs. Stablecoin
Because they are all founded on the same distributed ledger technology called blockchain, cryptocurrencies facilitate the quick and cheap transfer of digital asset ownership. Cryptocurrencies are transferred across encrypted, decentralized networks to prevent fraud.
People put their money into cryptocurrencies because they anticipate a price increase after the market establishes the level of demand for and supply of these assets.
However, the value of stablecoins is expected to remain relatively constant. You won’t feel as guilty utilizing a dollar-pegged stablecoin when the price of cryptocurrencies has increased significantly a week later, and you could have earned a profit (or colossal loss).
Introduction to USSD
USSD is launched on May 5, 2022, at BNB chain, Ethereum and Tron. This currency is officially guaranteed by blockchain chain markets in dollars equivalent to real USD by a value of one.
A one-month experiment like USDD is without real-world precedent. It is still quite close to the once-popular but now-less-used algorithmic stablecoin UST.
Before delving into the inner workings of this coin and the tokenomics that underpin it, it’s crucial to take a look at the individuals behind the currency.
USSD Stablecoin Economical Tokens
You can grasp the token economy of this coin with little work hard. Thanks to the Tron network, the platform’s token of TRX may be easily transferred to US dollars.
Token prices constantly change in response to market forces, including the US dollar demand, value, and supply.
However, we have previously noted that the USDD protocol has a mechanism that automatically values token re-couples from the dollar after it has decoupled.
In the past, nearly $159 million tokens have changed hands in the market, out of which the sum available is just above $704 million.
Purchasing USSD Stablecoin
Buying and selling US dollars is possible on several major centralized and decentralized exchanges. Some of the most well-known ones include Houbi, Sunswap, Gate, io, Poloniex, and coin.
While using an exchange like Poloniex, you may swap cash or any number of cryptocurrencies for US dollars.
The procedure is straightforward if you have experience with bitcoin exchanges. Instructions on how to use Poloniex are provided below (the process will be more or less similar in other exchanges). Use the given guideline to purchase this coin;
- Click the account wallet of the digital currency site and choose to buy coins.
- Choose ERU to purchase it.
- Pick your desired amount and this coin.
- Read all terms and conditions carefully and proceed with your purchase.
Working of USDD
The working of USDD is based on the pledges with the US dollar. There are mainly two circumstances:
When the USD demand is higher in the market, the price of USDD goes above the fixed price, which is $1.
Considering this situation, the USDD enables traders and investors to exchange 1USDD for $1 TRX. When a significant amount of USDD is created, it naturally creates pressure on the pricing and enables the price to stay stable at $1.
This opportunity also allows users to make a great profit from arbitrage trading, which is why users are approached to actively engage in it.
For example, if newly created USDD is priced at $1.1, users can sell them in the marketplace like Bitcoin Trading Platform and many others at the same price and make a $0.1 profit from it.
The other situation is when the price goes below the actual price. Given that, users can sell the USDD for $1, which will automatically create a halt in the creation of USDD.
The decline in the creation will impact the pricing, and in some time, the price will automatically revert back to its actual price.
Investment of USSD
USSD coin is considered a very safe, stable, and reliable stablecoin in digital currency for investment because the circle said their USDC stablecoin does not rely on any third party for its value. We think USDC is one of the most reliable stablecoins available today.
Note: Check our trading disclosure before venturing into digital asset trading.
