Tron’s TRX token rose as much as 27% in the past 24 hours as its ecosystem stablecoin decentralized USD (USDD) inched closer to its intended $1 peg.
TronDAO, a decentralized autonomous organization (DAO) that oversees development on Tron, said in a Wednesday tweet that it sent over $120 million worth of USD coin (USDC) to Binance to “purchase TRX,” creating buying pressure among traders. The DAO later sent another $100 million for the TRX purchase, it said in a separate tweet.
TRX rose to over 6 cents in Asian morning hours before a brief sell-off at the time of writing. The token was trading at 4 cents in European hours Wednesday. Futures tracking the token saw some $8 million in liquidations, one of the highest among major cryptocurrencies.
Additional demand for TRX likely came as traders tried to bring USDD back to its peg amid a broader market run that saw bitcoin (BTC) and ether (ETH) rise over 6.3% and 11% in the past 24 hours.
Earlier this week, Tron founder Justin Sun deployed over $2 billion as traders seemed to short TRX. Funding rates – or the interest paid by traders to borrow capital for a trade – to short, or bet against, TRX futures reached a whopping 500%. Sun said the capital was intended to “fight them.”
TronDAO said in a tweet Tuesday that it added $650 million of USDC to its reserve to “safeguard the overall blockchain industry and crypto market.”
TronDAO seems committed to protecting USDD’s peg to seemingly avoid a repeat of the implosion of Terra stablecoin terraUSD (UST). It received some $500 million in USDC Tuesday to “defend #USDD peg” amid “current extreme market conditions,” per a tweet.
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