Main navigation

$100,000,000 USDT Transferred to Binance: Here's Who Moved It and Why

Tue, 06/07/2022 - 14:16
article image
Arman Shirinyan
Here's what $100 million was spent on
$100,000,000 USDT Transferred to Binance: Here's Who Moved It and Why
Cover image via

Disclaimer: The opinion expressed here is not investment advice – it is provided for informational purposes only. It does not necessarily reflect the opinion of U.Today. Every investment and all trading involves risk, so you should always perform your own research prior to making decisions. We do not recommend investing money you cannot afford to lose.

Read U.TODAY on
Google News

An enormous amount of USDT has recently been moved to Binance exchange from an anonymous address. While community members started to panic, looking for who is behind the operation, the whale came out by himself and explained the nature of the transaction.

The transacted amount will be used as collateral for backing up the USDD stablecoin recently launched by Tron. Justin Sun announced that $100 million will be used for purchasing BTC and TRX, which will be used similarly to Luna and BTC in UST.

Cardano Reaches New Milestone in Number of Projects Building: Details

The scheme requires selling and buying of volatile assets for controlling the value of USDD algorithmic stablecoin. To attract more buying volume from investors and traders, USDD offers a high yield for anyone who is willing to provide liquidity for the stablecoin.

Following the Terra disaster, Sun faced criticism from investors all over the cryptocurrency community, especially after announcing that USDD will be backed with volatile assets in a manner similar to UST.

Binance Coin (BNB) Is Down 10% on Bad News Spree, But It Might Fall Even More

The main issue with the BTC and TRX backing concept is the volatile nature of a digital asset that can lose up to 50% of its value in a matter of days—if not hours. To maintain the balance and be able to hold the USD peg, USDD should maintain a relatively low capitalization that can be absorbed by the collateral behind it.

At press time, USDD's capitalization remains at $702 million, which can be covered with no problems by the Tron Reserve DAO. In the event that capitalization exceeds about $5 billion, TRON Foundation would need to increase the collateral behind the stablecoin to avoid Terra's UST and LUNA.

article image
About the author

Arman Shirinyan is a trader, crypto enthusiast and SMM expert with more than four years of experience.

Arman strongly believes that cryptocurrencies and the blockchain will be of constant use in the future. Currently, he focuses on news, articles with deep analysis of crypto projects and technical analysis of cryptocurrency trading pairs.