An Overview of Kucoin

Launched in 2017, Kucoin is one of the largest cryptocurrency exchanges by daily spot trading volume, with over 18 million users in 200 countries and regions. The home of hidden gems, Kucoin’s recent rise in popularity is attributable to its avid listing of high-quality potential projects with a small to midsized market cap, catering to a variety of investors with different investment appetites — hence aptly known as “The People’s Exchange”. In fact, Kucoin claims to be the Top 1 Altcoin Exchange, with 600+ (and counting) listed coins and $800 billion accumulated trading volume. It is no wonder as such that its token, KCS, has rapidly risen in value over recent years, even outperforming Bitcoin most of the time.

KCS vs BTC. Image taken from coinmarketcap.

What is USDD?

Issued by the TRON DAO Reserve, USDD is a decentralized, algorithmic stablecoin pegged to the USD to establish a stable, decentralized, and tamper-proof USDD-USD system. It will have a built-in incentive mechanism and a responsive monetary policy, which will allow USDD to self-stabilize against any price fluctuations, and help consolidate the value of USDD as a true settlement currency. USDD was recently listed on Kucoin exchange on 16th May 2022.

A Resemblance To UST?

The term algorithmic stablecoin would no doubt send chills down the spine of cryptocurrency investors these days, what with the recent LUNA and UST fiasco that has taken the world by storm. In fact, a quick perusal of the USDD whitepaper as shown below reveals an uncanny resemblance to the UST’s algorithmic mechanism of maintaining its peg to USD, by its interrelationship with its sister token, LUNA.

However, Justin Sun, the founder of the TRON blockchain, in his recent interview with Coindesk in the wake of LUNA/ UST unravel has addressed several key differences between the algorithmic stablecoins UST and USDD which are summarized below:

• UST’s downfall was attributable to its overly high leverage that even the Luna Foundation Guard (LFG) was unable to protect against, and which in fact had contributed to the cascade of events that unfolded quickly in what is now known as the ‘death spiral’, what with the massive selling of its BTC reserves.

• USDD on the other hand, will be backed by a $10 billion treasury, half of which will be in stablecoins mainly USDC and USDT, with the rest in BTC and TRX. The stablecoins are the first line of defense; the other assets can be liquidated if the need arises. This 2-layered safety net confers greater stability to the treasury.

How To Avail A Delicious 60% APR on USDD?

USDD can be entered into the many liquidity pools on the USDD site to fetch an APR of 30%, or simply staked on Kucoin to give a time-limited promotional 60% APR for 7 days!

• Sign up for Kucoin here, if you don’t already have an account!

• Buy USDD with USDT or USDC.

• Head over to Kucoin Earn.

  

  

• Select the USDD-7D staking pool.

  

  

• Indicate the amount of USDD you would like to stake. A minimum staking amount of 100 USDD applies.

  

  

• And you are done! Enjoy the promotional 60% APR rate for 7 days, while the staking quota remains. After the end of the promotional period, the staking reverts to a 30% APR, which is still a substantially generous offering for a stablecoin.

Final Thoughts

With stablecoins, the risk of depegging is real — a point which UST has gone out of the way to prove. USDD is a new player to this field — as promising as it may seem, its success as an algorithmic stablecoin is yet to be seen. As such, always do your own research and never invest any amount of money you cannot afford to lose. My personal stablecoin favourites are USDC (and USDT to some extent), which I stow away in high yield cryptocurrency accounts to generate passive income.

What are your thoughts on USDD? Feel free to leave your comments below! Happy investing.

As always this is not financial advice! But simply investment platforms I have invested in and have found worthy of sharing with. Do your own research before investing and never deposit money you cannot afford to lose. Feel free to ask me any questions below.

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