Tron Dao Reserve, the foundation behind the Tron project, buys 32,000 Bitcoin.
Tron boosts its reserve with 32,000 Bitcoin
Tron Dao Reserve, the foundation behind Justin Sun‘s Tron project, announced yesterday the purchase of 32,000 BTC, the exact same amount of Bitcoin that Tesla would have sold, further reducing its exposure.
Respect that @elonmusk and @Tesla backed Bitcoin at the critical moment of its development. #TRON DAO Reserve will carry on its mission to accumulate the same amount of Bitcoin (estimated 32,000 #BTC ) sold by Tesla as reserves in the futures.
— TRON DAO Reserve (@trondaoreserve) July 21, 2022
The move was commented on social media rather negatively, as it clearly denotes that the Tron project remains in the market spotlight and continues to raise doubts about the financial viability of its USDD stablecoin, especially in light of what happened in May with UST, Terra’s stablecoin.
This transaction comes a few weeks after the one also made by the DAO foundation to buy 38 million TRX to boost its reserves at a very difficult time in the market.
On 12 May, the Tron Dao Reserve had also purchased 1,250 BTC to strengthen its reserves.
The concerns of Tron and its founder about the integrity of the markets increased after the collapse of UST. Tron has an algorithmic stablecoin system, which supports the USDD project, very similar to that of TerraUSD. It is no coincidence that after the collapse of UST, Tron was hit by massive sales.
Following Terra’s collapse, Tron immediately proceeded to purchase 500 BTC at an average price of $31,031 for over $15.5 million, in addition to buying nearly 600,000,000 of TRX for $45,641,630.
The goal of the latest purchase
In total, the organization spent more than $60 million in the operation aimed at reassuring the markets that the project would hold. The DAO Reserve in a statement said:
“The operation was aimed to safeguard the overall blockchain industry and crypto market”.
On 16 June, Tron’s stablecoin, USDD, lost its peg to the dollar, sparking speculation that it could be the prelude to a new collapse of the entire ecosystem. But on Twitter, Justin Sun, promptly retorted that the foundation was ready for anything to combat speculation about the stock.
Funding rate of shorting #TRX on @binance is negative 500% APR. @trondaoreserve will deploy 2 billion USD to fight them. I don't think they can last for even 24 hours. Short squeeze is coming. pic.twitter.com/VRExM6UK70
— H.E. Justin Sun🌞🇬🇩 (@justinsuntron) June 13, 2022