Do you remember the stablecoin bloodbath in 2022? UST plummeted from $1 to $0.1 overnight, LUNA went to zero, and the Terra ecosystem evaporated $60 billion. At that time, the entire internet was furious, calling algorithmic stablecoins a Ponzi scheme, and USDD was also heavily criticized.

I was one of the loudest critics. Algorithmic stablecoins? Just a new packaging of a money-grabbing game.

Then reality gave me a harsh slap.

While everyone was still bearish on USDD, it had already undergone a transformation — from a purely algorithmic design to a decentralized stablecoin backed by over-collateralization. This is not just a technical upgrade; it’s a biological overhaul.

What’s the most ironic? The smart money had already noticed this change and quietly went about their business.

Now, the yield on USDD can stabilize at 12%, not some vague annualized figure, but real money that can be withdrawn.

Even more heartbreaking, during this recent wave of stablecoin de-pegging, USDC dropped to 0.98, DAI fell to 0.97, and even USDT was fluctuating around 0.999, but USDD? As steady as a rock, firmly sticking to 0.999 without moving.

It’s like the feeling during a stock market crash when others hit the limit down, and you’re still hitting the limit up.

Careful examination of the design logic of USDD 2.0 reveals that each $1 of USDD is backed by assets worth more than $1. This mechanism minimizes risk. Previously, we looked at it with old eyes, but in fact, we were fooled by our own biases.