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Duo Nine ⚑ YCC Profile picture
@DU09BTC
May 28, 2022 β€’ 20 tweets β€’ 11 min read β€’ Read on X
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1/ #USDD is NOT a stablecoin! WHAT? 😲

Here's my review of the USDD cryptocurrency on #Tron network. #TRX

Read the above again. This is the label they used for USDD in their whitepaper!

A clear red flag & there are more.

You asked & I delivered. A thread. 🧡

πŸ‘‡πŸ‘‡πŸ‘‡
2/ What is #USDD?

USDD is a cryptocurrency native to #Tron network.

This is nothing big on its own.

However, if you thought USDD was a regular stablecoin, I got a surprise for you. πŸ‘‡
3/ Check out this abstract from the USDD whitepaper.

Highlights are mine.

Let me dissect that for you in more detail below.

There is a reason the whitepaper is so... vague.

It's pretty obvious what's going on. πŸ‘‡
4/ "a cryptocurrency issued by Tron DAO Reserve"

This means it is centralized, full stop. Don't be fooled.

Look at Terra/Luna if you are in doubt (see link).

The Tron DAO has some clear members calling the shots.

Let's check them out. πŸ‘‡

5/ Whenever you read USDD is decentralized it means these "members" are in charge of it (see pics).

The Tron DAO Reserve is controlled by them and so is USDD issuance & burn.

If you hold USDD, you in effect trust these entities with your money.

Not convinced? πŸ‘‡
6/ The only thing decentralized about USDD is the Tron network.

The rest is about the above members sitting down & deciding "monetary policy" for USDD.

That is their whitepaper language, not mine! 🀣

Let us check the peg mechanism next... now we get to the juicy stuff. πŸ‘‡
7/ "a cryptocurrency [...] with a stable price"

Nowhere in the whitepaper do they say that #USDD should be pegged to the USD at a 1:1 rate.

NOWHERE!

USDD could very well be "pegged" to the USD at 10 cents in the future & it would still work as intended!

Wait, what? πŸ‘‡
8/ They do explain how the peg mechanism works, it is similar to Luna. 🀣

But the peg rate could be any: $1, 50 cents, 10 cents... or 0.

Users & arbitrageurs "can" choose to re-peg, or not! πŸ˜…

This is where things get fuzzy & funny! πŸ‘‡
9/ We have little info on #USDD backing.

The USDD "reserve" did buy some USDT + BTC to "defend" the peg.

Do they have enough in the reserve to back USDD? Probably not.

But this is fine so long TRX market cap > USDD mcap.

If not, see UST. Next πŸ‘‡

10/ Today's USDD mcap is 0.6 bil vs Tron's 7.7 bil mcap.

Not bad.

But I'd be very careful once USDD mcap is more than half of TRX mcap.

So why even do this, what do those "DAO members" gain? What's the incentive?

Leverage, arbitrage & market share! πŸ‘‡
11/ First, they can issue USDD against TRX market cap without backing. Yay free money!

This is similar to what Do Kwon did with UST, then bought BTC for free!

But they need to be careful as they can crash USDD/TRX if they leverage too high.

Next πŸ‘‡

12/ Second, only these DAO members "manage" the peg mechanism & can make a lot of profit from it.

Every time USDD goes above or below $1, they stand to profit.

If it goes too low, will they save the peg? For UST, $3 bil was not enough to save it.

What about the USDD users? πŸ‘‡
13/ To boost USDD market share (= pump TRX + leverage more), the "Tron DAO" gives incentives to users.

Sun.io USDD & USDT pool has 30% APY at the time of this post.

Not bad, but the risks are clear.

If USDD mcap gets too big = crash. 🀯

What should you do?
14/ Understand that USDD market cap is basically a leverage position on the ENTIRE Tron ecosystem!

See Terra / Luna crash for more (video)

If they get greedy, as Lunatics did, it will end in disaster for all involved

Plus, remember the whitepaper? πŸ‘‡

15/ To me, they have NO OBLIGATION to keep the peg at 1:1 with USD.

Even the title of their whitepaper is "Decentralized Stablecoin Protocol"

That can mean ANYTHING.

Don't be fooled or get too greedy, it may cost you. πŸ‘‡
16/ USDD is neither decentralized nor a safe stablecoin.

These labels mean little so long there is no transparency on its backing or the "USDD DAO" decisions.

Check out my guide on stablecoins to learn more.

Next πŸ‘‡

17/ Do your due diligence!

USDD may offer a juicy +30% yield, but is that worth the risks?

Are you comfortable with losing all your money?

This is exactly what happened to #UST + all token holders across the entire Terra ecosystem!

My risk assessment on USDD is next. πŸ‘‡
18/ Calling #USDD a stablecoin is very misleading & risky!

Calling it a cryptocurrency is much better, as per their whitepaper. 🀣

If you are a degen, you can farm that yield no questions asked.

Just get out early & don't look back once USDD mcap grows too big.

Finally πŸ‘‡
19/ If you liked this thread, #retweet the first post to get more of this content in the future! 😍

Stay in touch + follow @DU09BTC:

Discord: bit.ly/3n2gng0
TradingView: bit.ly/3FUjwHj
YouTube: bit.ly/3p8vPdf
Newsletter: bit.ly/3MUpkna
Retweet for more content like this! πŸ‘‡πŸ‘‡πŸ‘‡

Thank you!

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More from @DU09BTC

Duo Nine ⚑ YCC Profile picture
Nov 16
How to find the top in this cycle. A thread.

When you see these 10 signals flashing, it's time to bail. Signal 9 will tell you when to sell altcoins.

Bookmark this thread! Let's go. 1/12 🧡 Image
2/ Signal 1: Terminal Price

Bitcoin price hits the red line? Sell hard.

Current terminal price is 170k.

This accounts for the movement of Bitcoin on-chain. @_Checkmatey_ invented this indicator. Image
3/ Signal 2: Stock-to-Flow Model

Start selling whenever the price moves above the stock/flow line.

That's above 150k today. Will be 200k later.

Either way, early 2025 looks like a prime period to sell. Image
Read 12 tweets
Duo Nine ⚑ YCC Profile picture
Oct 27
Bitcoin is in trouble.

If nothing changes soon, things won’t be pretty.

I’m not talking about the halving schedule or block rewards, it’s much more serious than that.

A thread 1/17 🧡 Image
2/ As Bitcoin goes mainstream, fees to transact on its network will replace block rewards.

This will be gradual and take place over decades. However, a new problem is starting to emerge.

It was harder to predict this, but now it’s here. Image
3/ The first incentive is to buy and hold Bitcoin. Nothing new so far.

However, we now have a bigger incentive. It has to do with you NOT using the real Bitcoin.

Intrigued?

Let’s look at the facts next and follow @DU09BTC before we continue.
Read 17 tweets
Duo Nine ⚑ YCC Profile picture
Oct 11
If you hold Ethereum, you are in trouble.

Uniswap, an ETH dApp generating $500 mil / year in fees, just created its own L2. Now, those fees are reduced by 100x and go into Uniswap pocket.

Multiply this by 100x with other dApps and ETH's price will go to zero. A thread 1/12 🧡
2/ The reason Ethereum has value is because of its fees that generate demand for its native token.

At the time of this post, it costs over $10 for a simple token swap.

ETH is on borrowed time as users are rightfully ditching this expensive chain. Who's to blame? Image
3/ Vitalik and his team.

They decided to scale Ethereum via L2s, but in the process they are losing their users. A bit ironic considering L2s were meant to fix ETH's scaling problem.

As L2s proliferate and users move out, Ethereum faces an even bigger problem. Image
Read 12 tweets
Duo Nine ⚑ YCC Profile picture
Oct 5
It took me 10 years in crypto to learn this - PART 3!

I'm offering you a shortcut so you don't have to wait that long.

The cycles repeat, but they are not the same.

Here's Part 3. A thread. (1/11) 🧡 Image
2/ Since I started in 2014, I made many mistakes, but nothing compares to this one.

Buying altcoins.

But what did I know back then? Nothing. If you're new to crypto, learn from this thread.

What's my lost profit over the years thanks to alts?
3/ Over $1 million had I put that money in BTC and held. There is a reason I say this.

Altcoins are a losers game over time.

Bitcoin is a winners game over time.

Which game do you want to play? My next point will help sway you in the right direction.
Read 11 tweets
Duo Nine ⚑ YCC Profile picture
Oct 1
Last night I was the victim of one of the most complex social engineering scams I've ever seen impersonating @paraficapital staff.

If you're in crypto, you are a target.

This thread will show you how they did it and if they succeeded. Time to find out - 1/15 🧡 Image
2/ If you have any following they will target you. Their account will look spotless, clean text + X verified.

Ryan is a Principal of a billion dollar crypto company and sends you a DM on X, then he moves you to TG.

Your first priority is to confirm credentials. How? Image
3/ Ask a DM from their company X account or to send you an email using their official domain name.

Ryan was frustrated with my request, so he told me I need to do proper DD and see he's followed by almost all his Parafi team.

Instant red flag, but I decided to play ball. Image
Read 15 tweets
Duo Nine ⚑ YCC Profile picture
Sep 29
It took me 10 years in crypto to learn this - PART 2!

I'm offering you a shortcut so you don't have to wait that long.

The cycles repeat, but they are not the same.

Here's Part 2. A thread. (1/12) 🧡 Image
2/ Altcoins are highly extractive.

VCs print tokens from thin air with a cost basis of ZERO.

When there is any demand for their token, they sell and absorb that demand. This is how they take your money, legally.

This is also why your blue chip alt didn't make a new ATH. Image
3/ VCs don't care about their token price!

As long as there is any retail demand, they can sell into it at a profit. That includes tokens down by 90% to 99%.

Remember, their cost base is ZERO! While retail waits for new highs or buys "discounts", VCs laugh at you. See XRP. Image
Read 12 tweets

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