Justin Sun is starting to get a great deal of attention again. At some point, this guy's luck will run out.
With all the heat on stablecoins, the last thing that is needed is Sun being one of the poster children for it. Most inside the industry understand what he is all about and him propelling himself into the middle of this controversy is not a good thing.
It is likely that his project fails miserably. From the start, he took the wrong approach, i.e. trying to get right into the game without generating any value. It is the same thing that happened with UST. Instead of building value for the token, or at least the coin backing it, they just went and pumped it right to the top.
Without value, there is no resiliency. Thus, it is hard to see where there is any protection against a collapse.
That said, one YouTuber went a step further.
Source
USDD A Ponzi Scheme
Stephen Findseisen, a.k.a. Coffeezilla, has some harsh things to say about Sun's stablecoin. He went as far as to say it is nothing more than a Ponzi Scheme.
This is notable since USDD is now off its peg and trading under 98 cents. After UST, this is starting to get people nevous.
One of the main issues Coffeezilla brings up is how USDD is created. Not everyone can generate it. The majority of it was done out of an account many believe is Sun's. There were a few other whitelisted institutions that also could do it.
Hence, the idea of an algorithmic stablecoin is not in play yet. Of course, the issue of centralization is.
This can prevent the death spiral that UST faced. However, it also does not allow for arbitrage via a large number of players between the creating and destroying of USDD. Of course, holding a peg is very difficult without wide spread arbitrage.
Another complaint by Coffeezilla is that Sun is dumping TRON without affecting the market.
According to the investigation, the answer is 683 million tokens out of a total number of 723 million tokens that have ever been minted. This indicates that Sun has personally minted 94% of all of the tokens that are now in existence of the stablecoin, despite wanting to see USDD grow in an organic decentralized fashion.
“Not only do I obviously think this coin is offering an unsustainable yield. I think it is also a really clever way for Justin Sun to offload TRON without affecting price,” Findseisen said.
Here is how he sees it.
)Source
Since it is believed that Sun created most of the USDD from his TRON, he is the one who benefits by "selling" the USDD on the open market.
This would be keeping right in character with Sun.
How HBD Is Different
Many often wonder how is the Hive Backed Dollar (HBD) any different?
There are a lot of things in the works that are aimed at providing resiliency. We will not go through them all here but hit upon a couple highlights.
To start, there is less than 25 million HBD in circulation at the moment. USDD went from none to 750 million in a few months. Sometimes slow and steady is the proper path.
Also, Tron is a joke. There is very little that is serious on there. Many know that Sun is great at marketing, yet a failure at building something that is expanding and developing. Thus, at the end of the day, how much value is really tied to the token?
With Hive, we are seeing utility being generated. Not only does it provide for governance, we are soon seeing the delegation of Resource Credits. These are "created" by powering up $HIVE to allow people interaction with the blockchain. Obviously, applications and games are going to be incentivized to provide these for their users. Ultimately, someone is going to have to stake it.
We also see other initiatives to generate value for $HIVE. This is important because it is the reserve. With each HBD backed by $1 worth of $HIVE, having value in that asset is vital.
Finally, we are seeing moves to give HBD, itself, some value. By focusing upon a few different areas and building layers on top of HBD, on its own value will be accrued. This is not an overnight process and requires a great deal of effort.
Sun never was interested in something like this. For that reason, his entire ecosystem is like a house of cards, ready to tumble at any time.
The challenge with trying to integrate a lot of different pieces into something without a foundation is that it only creates a bigger mess. Nothing is helping to leverage against anything else. Thus, the value that comes from things such as network effects are not there.
Is it a Ponzi Scheme? Time will tell.
Nevertheless, with Sun, it is not likely to benefit many other than himself.
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A thief, a fraud, and a moron walks in into a bar.
- "GTFO Justin", says the bartender.
LOL Priceless.
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We currently have a $FART Token Governance vote regarding Justin Sun remaining on staff as a Moderator for the Community. We made a post this morning in the Farting Community explaining the process. We are all about free speech however the facts are not looking good for Justin and we feel the community should have a say in whether he stays or goes.
The biggest problem here is the lack of decentralization. Justin Sun seem to have a need to be in control of his "decentralized" projects far more than most other cryptocurrencies built by VC or other corporate entities.
This is a good time to get our marketing to work. I would fully support spending from DHF to have effective ad campaigns to get people more interested in what we have in the HIVE ecosystem. I think games are the best gateway. Other than that, @dbuzz and HBD could be a very powerful tool to generate investor interest. Bear markets are the best times to build great things. We should be doing more work on getting ourselves known the the larger public.
!PIZZA
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Yes the centralization by Sun is an issue. Of course, as you mentioned, that is all he cares about. That is how he can "Steal" so much simply by running the validators and vote himself all proposals.
As for Hive, there is still a lot of infrastructure required. We are making progress but it will take time. To prevent a UST or USDD, HBD needs a solid foundation built. This includes a lot more than just simply offering a ROI on staking.
That said, we also have to keep increasing the long- term value of $HIVE. Again, this is something that USDD and UST did not do.
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Making it easy to accept HIVE and HBD for purchases is one of the best things we can do. BTC have massive transaction fees when the network is congested. Lightning Network has its own hassles. HIVE on the contrary does not have transaction fees. This is such an excellent proposition. USDT has been doing extremely well on Tron with its lack of fees. Even if we cannot immediately get people to accept HBD, we could try getting them to accept pegged assets that are on HIVE-Engine without having to go through complex wallet addresses and fees. Usernames and feeless can transform the user experience in cryptocurrency.
!PIZZA
Been writing a lot about how to get value to HBD. One of the keys is payment, not only commercial but also for financial. We also need derivatives made.
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good points!
Thank you!
Sun yet again giving crypto a bad name, who would've thought.
I swear I'm starting to think him and Tron have been planted by some party to make crypto look like a joke so it would never get serious money coming in. Would explain why a majority of top coins are shit that would make Satoshi turn over in his grave.
Hard to argue with that point. It is like the intention is to make something look as bad as it can.
Sun is like a cancer infecting the entire industry.
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It all shows how immature this space is. There are actually a lot of cancerous agents, centralized stable coins are another. We need to grow to the stage where we have properly designed decentralized algorithmic stable coins, HBD will grow no doubt, but we will need more than HBD to get rid of these cancers.
Yes we will need legitimate projects along with a larger pool of people.
With that, the industry can start to separate the legitimate from the con artists.
Use case is going to be imperative.
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They are defying the purpose of crypto intentionally...
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Why are exchanges listing that bs, because they are minting them as well right? That’s basically super illegal in all western economies.
I would say they make money off it.
And it is only illegal if it is proven. This is one claim (it might be an accurate one) but not from a regulatory body.
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That's absolutely right, but 10 years is a long time and if more and more laws are getting applied then the nuke will hit eventually.
This is the time Chuck Rhodes would come swinging law suits.
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That stuff is on chain and they are liable for 10 years at least. I don’t get why they would go down that road. Not even in the crypto space will anybody defend that misbehavior.
That's acting for personal gain in its extreme, I read that he has a personality of being self centered.
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Thanos LeveL of nutZ
This is terrible. He paid millions to have lunch with waren Buffett. Now I know where the money comes from, he's a thief !
Good observation. That was known for a while. He is one of the biggest cons in crypto.
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Great is part of your post. The concept of general knowledge and global knowledge. Thank you very much for gaining a lot of knowledge by displaying your post. I pray for you, sir,@taskmaster4450
to give us such a beautiful post as a gift.
This bad apples just retard the growth of the crypto industry. The guy is just a con artist framed as a businessman. When is it going to be enough? I wish the USDD collapse be the final nail on coffin for Justin Sun.
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Sadly that is the case. We do see it drawing the wrong kind of attention. Alas, we allowed it to take place. How many have truly spoken out against it and pushed others to not implement what he is into?
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I will be watching from far, getting involved with a Sun project is like dinning with the devil where your spoon have to be extremely long, in Sun's case even a long spoon won't save you.
I I'd rather observe from far away.
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You will end up hungry that is for sure.
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One of the things that makes Sun very popular is his ability to stay in the spotlight. We all know that many Crypto project would need marketing which is one area he's good at.
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The spot light is good and I'd choose the limelight rather, lol.
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Well, a lot of people would choose that.
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I mean, the two words mean the same thing but one sounds shinning and the other feels worthwhile.
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He does do what it takes to keep in the spotlight.
Is that good or bad on this one?
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USDD is absolutely a ponzi scheme.
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That appears to be the consensus.
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I'm not sure that USDD is a Ponzi scheme, but I think that it will presumably be a failure later on, since the biggest mistake is bombing the market without having a backing.
A worse mistake is bombing the market without much utility or value.
People seem to overlook the fact that stablecoin value is vital. Without that, there is no way for a peg to hold.
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I'd love to see a RC delegation marketplace a bit like how slease worked but it only accepts HBD. Cause we need a few more native uses for it.
Well the hard fork is just bringing out the ability to delegate.
A secondary market might arise but that will have to be built by someone, I presume on the second layer.
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Bros been running one since Tron
Sun is always there with the TRX shit with unlimited supply and still now he is doing these stuffs. Though TRX has enormous possibility with the low cost faster transaction but this his stable coin will make his name erased completely from the crypto space. I don't why still people believe such a irresponsible guy!
There was a time that might have stood out. But now there are a lot of the EVM chains out there that TRX isnt unique at all.
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If he is really running a ponzi scheme, then in a country with proper and properly executed laws, he would already be in prison/jail, because running a ponzi scheme is a type of a scam/fraud, so it is a crime, and he is a criminal. If he is really running a ponzi scheme.
As you wrote, time will tell.
Sun has a knack for avoiding the attention of authorities.
How long will it last is the question.
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You simply can't beat, all you can do is to work with time and all would fall in place.
It is sad that fear and greed kills the market. How do you possess one and don't go crashing.
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Doesn’t surprise me that one wallet linked to JS is minting everything 🤣😂 people have been played throughout all of human civilization and it very obviously is still happening today.
I remember Sun from
Steemit, but is he doing anything here on HIVE or did he know we all hate him and stayed away?Sun's stake, through the ninja mine, was put into the DAO. He did not get an airdrop.
So his influence would only be based upon his purchase of Hive.
That doesnt interest Sun. He cant touch Hive.
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Only a brain-dead can invest on Sun's projects :D
LOL TRON is the blockchain for zombies.
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I saw that Coffeezilla video a few hours after it came out and I do think the research is about right. It's not decentralized and no single entity can really control HBD. So I think HBD is far superior to the Ponzi that is USDD.
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HBD is far superior to USDD.
It is important for us to keep working on building value for HBD. That is what will separate it from everything else.
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Wait? Poor Justin is scamming everyone again? I can't believe it!!!! LOL
!1UP
I know it is truly shocking. Most will find it impossible to believe.
He is such an upstanding citizen. He is an ambassador after all.
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It is time for the 🌞 to set.
HBD is clearly a superior stable coin. It's easy for the ignorant to get HBD confused with the fraud coins out there, we have to make a clear distinction explaining why HBD is worth investing in, something more than interest rates, an assurance that HBD won't suddenly drop deep below $1.
I agree. We also have people working on creating legitimate use cases for HBD. That is something that Sun was never interested in with USDD. Instead he simply wanted to make sure he offered the best rate so that he could attract the attention.
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I think I read that darthknight is still in legal dispute over the funds that Sun froze a couple of years ago. Why is this guy still walking around freely like any normal person when there have been endless opportunities to jail him? lol
Anyway, thanks to him (ironically) we are here. Maybe Hive is the project that we all dreamt of at that moment.
There are a number of people within Hive who are in legal disputes with Sun. His stealing of funds triggered a lawsuit by many who had them frozen.
Sun bringing out USDD and scamming there might be a fatal decision. He is now going to get the attention of the regulators.
That could put a target on his chest.
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I think nobody is surprised anymore about Justin's shenanigans.
It is hard to be surprised.
A leopard doesnt change its spots. By now, it is evident what sun is.
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This was very informative, and I went and watched Coffeezilla's video. How many scams can a single person get away with before people turn on them? Guess we'll just have to wait for this ponzi to implode
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We should call him Teflon Sunny Boi.
He keeps evading the authorities. We will see when his time is up.
Maybe Grenada will protect him.
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hahaha that's a good nickname! He's been a scammer since day 1, and from what I have read and heard, his hostile takeover of Steem really messed things up, and precipitated the creation/fork of HIVE!
Trust is an essential when it comes to activities in the crypto industry. It’s no longer news Justin Sun is seen as a controversial figure ; considering handful allegations levelled against him both in the past and present . If a YouTuber labels his USDD project as a Ponzi scheme , that won’t be far fetched with all the reasons you’ve clearly stated above.
Only time will tell what is real at the long run , time doesn’t lie at least !
There is no doubt that he appears to be running on borrowed time.
With regulators salivating around the world, I cant believe he will not be a target soon.
The entry into the stablecoin market could really put a bullseye on his chest. If the allegations that are being made are true (which they are) then the SEC, DOJ, and other alphabet entities will have a field day with him.
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la taza de intereses es muy alta, recuerden que este tipo ya ha estafado a mucha gente, no me extrañaria que aplicara la misma que hizo el ceo de LUNA, yo personalmente no invertiria en TRX y ninguna de sus monedas aliadas. Estan propensas a robar a todos, que antes era defenzor de USDT pero ahora me refugio en la del delincuente de Binance. BUSD es igual de peligrosa pero es mas dificil que esta moneda pierda su peg al dolar de estados unidos
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