What the crypto world lacks the least is various promises, but what is the scarcest is trust, especially in the stablecoin field. You exchange real money for numbers on the chain; why should you believe it is really worth 1 dollar? USDT claims to have sufficient reserves, but the audit reports come out once every six months, and they are also a stripped-down version. USDC is compliant, but its reserves are all in the U.S. banking system. If something happens to the banks or they get frozen, ordinary users don’t even have a say. This asymmetry of information has kept the stablecoin market on the brink of a trust crisis.
USDD launched something called Treasury Dashboard on October 22, which in Chinese is called 财务仪表板. It sounds quite boring, but the significance of this thing is seriously underestimated. It lays out all the financial data of the USDD protocol on the chain: how much income, how much expenditure, how much account balance, how much JST has been repurchased—all in real-time. Moreover, anyone can check it without needing to register or undergo KYC. You can directly open usdd.io/treasury to see it.
This move is pioneering in the stablecoin space. Have you seen any stablecoin project that dares to make its books completely public? Most projects only release a PDF quarterly, and whether the numbers match relies entirely on their integrity. Furthermore, many key pieces of information are treated vaguely, such as the specific composition of reserves, which channels investments are made, and what the yield rates are. These core issues are generally not disclosed, with the excuse of being trade secrets or security considerations.
USDD has broken through this barrier. Data displayed on the Dashboard shows that the protocol's net income each quarter will be directly used to buy back and then burn JST. This mechanism is not a promise written in the white paper but a program that is already running. You can see every buyback transaction hash and verify the quantity burned. This level of transparency provides tangible value to holders of the governance token JST.
Moreover, the design of this buyback mechanism is quite clever. It is not a fixed percentage but is initiated only when the total income of the USDD ecosystem exceeds $10 million. This threshold ensures that the protocol has sufficient operational funds while also giving back to the community during profitable times. More importantly, all operations are executed on-chain, eliminating the possibility of the team taking money without conducting buybacks.
Let’s do the math: the income sources for USDD mainly consist of two parts: one is the net profit sharing from JustLend DAO, and the other is the interest earned by Smart Allocator on protocols like Aave. JustLend is the largest lending protocol on TRON, with a TVL consistently over $1 billion. Based on an annual interest rate of 3-5%, it can generate tens of millions of dollars in income per year. Although Smart Allocator is more conservative, it can still reliably contribute several million in profits.
This money does not go into the team's pockets but is returned to JST holders through a transparent mechanism. In comparison, USDT, issued by Tether, earns profits in the tens of billions of dollars each year, but users do not receive a cent. All profits are taken by the company's shareholders. This is the essence of centralized stablecoins: they serve the interests of shareholders, not users.
The governance model of USDD is closer to true decentralization. Although the protocol was initially initiated by TRON DAO Reserve, major decisions need to be voted on by the JST DAO, such as adjusting the collateral ratio, modifying the stability fee, and adding new types of collateral. All these proposals must go through community discussions and on-chain voting, with voting weights distributed according to JST holdings. Additionally, all voting records are publicly available.
Recently, there was an interesting proposal regarding lowering the stability fee rates for sTRX and TRX vaults. This proposal was approved on December 15th, reducing the fee for the TRX vault from the previous level to 0.5% and for sTRX to 1%. This adjustment will last until January 15th of next year. Lowering the fee means that the cost for users to mint USDD is lower, which can attract more participants, and it also indicates that the protocol has sufficient income to support operations without relying on high fees.
This dynamic adjustment mechanism is particularly important because market conditions are changing. In a bull market, everyone wants to leverage up, and the demand for minting is strong, so fees can be raised appropriately. In a bear market, demand shrinks, and lowering fees can stimulate activity. Traditional stablecoins cannot achieve this kind of flexibility; their rules are set in stone, and any changes must go through a lengthy corporate decision-making process.
Speaking of governance, we must mention the positioning of the JST token. Many people think JST is just a governance token for voting, but its value goes far beyond that. In addition to voting rights, JST holders can also share in the protocol's profits. Through the buyback and burn mechanism, the supply of JST will continue to decrease, creating a deflationary model. Theoretically, the value of holding JST long-term will increase along with the growth of the USDD ecosystem.
Moreover, JST can also be used as collateral in protocols like JustLend. Although the collateral requirements are relatively high, it still gives the token actual utility, unlike many governance tokens that can only vote and do nothing else, ultimately becoming worthless.
From the perspective of participation, the voting rate of the JST DAO is actually quite good. Although not every proposal can spark a nationwide discussion, the voting participation rate for proposals involving core parameters of the protocol usually reaches over 50%. This number is considered quite high in the field of DAO governance, as many well-known projects have DAO voting rates that linger in single digits, lacking substantive governance.
Why can USDD achieve such transparency? I believe there are two reasons. The first is the technical foundation: all data is recorded on the blockchain, making it too costly to fake, and it would be immediately discovered. The second is the strategic choice: the team is very clear that after the collective collapse of algorithmic stablecoins, the greatest demand from the market for stablecoins is trust. Instead of hiding information, they prefer complete transparency, letting the data speak for itself.
This strategy is indeed effective. After the launch of the Treasury Dashboard, the TVL of USDD has significantly accelerated its growth. Many users who were originally hesitant have started to try it out, as they can clearly see the health status of the protocol without blindly trusting official statements. The data is right there: Is the reserve sufficient? What is the collateral ratio? Where does the income come from? It's all clear at a glance.
Moreover, this transparency has an unexpected benefit: it allows for quick identification and resolution of issues. If there is an abnormality in a certain aspect of the protocol, such as a rapid decline in the collateral ratio of a certain vault, or a large amount of reserves being withdrawn from the PSM, these signals will immediately reflect on the Dashboard. The team and the community can respond promptly and take action.
In comparison, when USDC faced the collapse of Silicon Valley Bank in March this year, the entire market had no idea how much money Circle had deposited in that bank. Initially, the officials were reassuring everyone that everything was fine, but USDC directly de-pegged to $0.88. When the truth came out, Circle indeed had billions of dollars in reserves at Silicon Valley Bank, but it was too late; trust had already been damaged.
USDD's model will not encounter such a situation because all reserves are on-chain and distributed across multiple protocols and chains. You can see in real-time how much money is in each pool. Even if a specific protocol encounters issues, the impact is localized and will not lead to systemic collapse.
This design philosophy actually represents the core spirit of DeFi: replacing trust with code and transparency. You do not need to trust any individual or institution; you only need to verify the data on the blockchain. This is the role blockchain technology should play.
Of course, complete transparency comes with a price. For example, competitors can easily analyze your strategies, and arbitrageurs can more precisely capture opportunities. However, the USDD team clearly believes this price is worth paying because the trust value brought by transparency far outweighs these tactical disadvantages.
In the long term, I believe innovations like the Treasury Dashboard will become standard for stablecoins, just like smart contract audits. Previously, everyone thought audits were optional; now, projects without audits are hardly used. In the future, stablecoins without financial transparency may also be eliminated by the market.
There are already signs showing that this trend is occurring. Some newly launched stablecoin projects are beginning to emphasize real-time verifiability of reserves. Although they cannot yet reach the level of USDD, at least the direction is correct. Regulatory bodies are also promoting this matter; the EU's MiCA legislation requires stablecoin issuers to regularly disclose reserve information, although many details regarding implementation still need to be finalized.
USDD is ahead in this regard. It is not passively responding to regulation but actively embracing transparency. This stance lays a good foundation for potential compliance in the future. Regulatory agencies are most concerned that stablecoins become tools for money laundering or Ponzi schemes. If you can prove that every flow of funds is clear and that every decision has undergone community voting, the difficulty of compliance will be greatly reduced.
Returning to JST's buyback mechanism, there is another clever aspect to this design: it ties the success of the protocol to the value of the token. The more the protocol earns, the more JST is bought back, and the supply decreases. Theoretically, this will lead to an increase in value, providing JST holders with a clear expectation based not on speculation or narrative, but on tangible performance.
Moreover, the buyback is ongoing, not a one-time event. As long as the USDD ecosystem remains profitable, buybacks will continue indefinitely. This long-term value accumulation effect is more meaningful than short-term price fluctuations. Many projects that conduct buybacks do so as a one-off event, creating a wave of hype and then ending it. The USDD mechanism is clearly designed for long-term operation.
From the perspective of user experience, the Treasury Dashboard also provides a great educational tool. New users can learn how the protocol operates by observing the data: Where does the income come from? How is the money distributed? This is much more effective than reading the white paper, as the white paper discusses theory while the Dashboard showcases reality.
