USDD simply means a kind of "digital dollar" in the cryptocurrency world.
It is not directly issued by banks or companies, but is a "decentralized" version created using blockchain technology—no one person can make the decisions, and everyone collaborates through code and rules to maintain it.
Its goal is to keep the value of 1 USDD as close to 1 dollar as possible (called a 1:1 peg), so when you use it, it won't have the large fluctuations like Bitcoin.
To ensure stability, it uses an "over-collateralization" method: for example, if I want to issue 100 USDD, I must lock up other cryptocurrency assets worth 130 to 150 dollars or even more (like BTC, TRX, etc.) as collateral. In case of market fluctuations, these extra collateral assets can act as a buffer, preventing a crash.
The benefit of this design is that it is safer and more transparent; all collateral and issuance processes are publicly available on the blockchain, and anyone can check.
It is mainly used on DeFi (decentralized finance) platforms, such as borrowing money, saving money to earn interest, and trading currencies, which can be seamlessly integrated, providing everyone with a reliable "dollar substitute" without worrying about the restrictions of traditional banks.
In short, it aims to give you a stable and free dollar tool in the cryptocurrency world.
