Justin Sun, Tron Foundation CEO, announced the launch of a new stablecoin backed by Tron (TRX) and BitTorrent (BTT) on Thursday 16th January 2020. The flamboyant and media friendly founder asked for the community’s opinion on what to name the coin in his ever-present suggestions/guessing game during announcements. However, the tenth largest cryptocurrency on Coinmarketcap list traded flat on the breaking news, rising less than a percent in the past 24 hours.
Justin’s breaking news!
Tron’s stablecoin news first broke out last week when Justin Sun promised the community a “big upcoming announcement” urging the community to guess the possible launch. Now, the Tron and BitTorrent backed coin (still to be officially named) is expected to launch in the near future to allow low volatility crypto use across the world.
The TRON community will be pleased of the first fully backed decentralized stablecoin using TRX and BTT as collateral and get back the stablecoin in return. One person familiar with the matter said,
“To get your collateral back you have to send the same amount of stablecoins back to the smart contract + interest.”
However, the community is treating the latest “big announcement” from Tron as a joke as many believe the stablecoin will be no different from the rest of the stablecoins. On the question of naming the new TRX/BTT-backed stablecoin, one respondent said,
“Zero coin (suggestion of the SC’s name) because that’s what it’s worth and what’s it’s been worth the past year.”
Despite the news of a new stablecoin, the price of TRX remained rather stagnant over the past 24 hours, registering a 1% gain in the past 24 hours.
TRX/USD set to break above $0.02000 USD?
Despite the price of TRX remaining pretty stagnant over the past day, the chart indicators signal a possible bullish run. Since breaking above the resistance of the bearish wedge, at $0.01380 USD on January 6th, TRX/USD has been on a stable uptrend showing a possibility of testing key resistance level at $0.02200 USD. The higher timeframe relative strength index (RSI) oscillates at overbought levels, hence a short term pullback can be expected towards $0.014000 USD before the continuation of the mega bull run.
The launch of the new stablecoin may increase the demand of TRX as users exchange the coin as collateral for the SC. Intuit Consultants on Twitter explained,
Stability is maintained by changing the interest rate you pay for the stablecoin (SC). If SC >1 USD then interest rate goes down, which increase SC supply b/c more ppl create SC. If SC <1 USD interest rate goes up, which decreases supply b/c ppl destroy SC to get back collateral
— Intuit Φ Consultants (@Intuit_Trading) January 17, 2020
Will TRX break key resistance at $0.022000 USD once the stablecoin launches?
Disclaimer The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.
Been in the field since 2015 and he still love everything blockchain and crypto! FC Barcelona fan. Author and journalist. Follow him at @lujanodera.