Tron DAO Reserve has announced the acquisition of $50 million worth of Bitcoin (BTC) and Tron (TRX) to add to USDD’s reserves. The acquisition was made public by the following tweet, which also included an explanation that the Bitcoin and TRX were acquired “to preserve the entire blockchain industry and crypto market.”
Currently USDD Is 197% Overcollateralized
The goal of Tron DAO is to overcollateralize the USDD stablecoin by a minimum of 130 percent, and as part of this aim, they have decided to acquire a total of $50 million worth of Bitcoin and Tron (TRX). As of the time this article was written, the USDD algorithmic stablecoin is overcollateralized by a factor of 197 percent, as seen in the screenshot below, which was kindly provided by the USDD website.
Reserves USDD =Â 14k BTC, 140M USDT
The snapshot that can be found above also reveals that the United States Dollar is now supported by 14,040.6 Bitcoin (BTC), 140 million in Tether (USDT), and 1.906 Billion Tron (TRX). The value of USDD reserves at the moment is determined to be $683.515 million.
Bitcoin Drops to a New Local Low of 28,099 USD
The Tron DAO reserve has just made a purchase of Bitcoin and TRX for a total of $50 million at a time when Bitcoin is experiencing a significant decline to a local low of $28,099. This low was reached only a few seconds ago. The daily trend of BTC/USDT shown below still indicates a pessimistic outlook for Bitcoin for the next several days. A continuance of selling pressure below the 50-day moving average is suggested by the daily MFI, RSI, and MACD indicators (white).
The 6-hour Chart of Bitcoin Suggests That the $28k Support May Hold
However, as will be noted below, the 6-hour chart for Bitcoin provides a signal that the $28,000 support region may serve as a floor for the selling in the short term.
In addition, $28,000 can prove to be a helpful support level for Bitcoin considering that the 6-hour MFI and RSI indicate that the market is now in an oversold condition. However, given the low transaction volume that is typical of weekends during bear markets for cryptocurrencies, exercising extreme care is recommended before attempting to long Bitcoin at the current levels.
Consequently, because Bitcoin has not yet retested the $24,500 low that was made during the crypto market sell-off that was triggered by UST’s depegging event in early May, a wait-and-see strategy would be a more rational move given the current market conditions.
So the Key Takeaways
- Tron DAO Reserve has made the announcement that it has added to USDD’s reserves by purchasing Bitcoin (BTC) and Tron (TRX) for a total value of $50 million.
- At the moment, the USD is 197 percent overcollateralized, which is a significant amount.
- There are now 14,040.6 bitcoin, 140 million USDT, and 1.906 billion Tron (TRX) backing the stablecoin known as USDD.
- The acquisition of Bitcoin (BTC) and Tron (TRX) takes place at a time when Bitcoin (BTC) is once again testing the $28,000 support level.
