Cardano is set to deploys its first Stablecoin —Djed— soon. This will provide allowance for cheaper transaction and thereby makes it easier to run DeFi projects.
Also, Software development company COTI makes the announcement few hours ago of the issuance of the first stablecoin. Additionally, Saying it is designed to run on Cardano.
However, Charles Hoskinson, leader of Cardano, and Shahaf Bar-Geffen, CEO of COTI Group, at the Cardano Summit stage in Laramie, Wyoming were the first to give away this information.
Furthermore, This Djed stablecoin will be on Cardano. Also, its designed to contribute to the growth of its nascent ecosystem. More so, particularly now that the blockchain is starting to show support for smart contracts. Additionally, this new development gives the markets strong expectations about the possible development of DeFi platforms on a blockchain. Of course, in one platform not stained as the future Ethereum Killer.
The Details On Djed and Why Cardano Needs It?
Firstly, Stablecoins are cryptocurrencies helping to maintain a stable value with respect to a reference. For instance, the best-known stablecoins are cryptocurrencies like USDT or Stasis. So, they pair with fiat currencies like as the dollar or the Euro. Also, some cryptocurrencies value pairs 1:1 to other commodities such as gold (like Digix) or even to other cryptocurrencies or baskets of cryptocurrencies.
However, there are ways to make this possible already, some effective than others by the way. For instance, there’s the holding or blocking of an amount of the reference asset that supports the issuance of a proportional amount of the correspondent stablecoin.
For example, the market capitalization of USDC is $3,677,063,935 because there are 3,677,063,935 USDC tokens in circulation and Circle holds $3,677,063,935 in collateral.
Furthermore, the value of Djeb will be stable by an algorithmic design, leveraging smart contract design on the Cardano blockchain. This will also maintain a price as close as possible to $1.
How?
Djed will maintain a reserve of base coins while mining and burning other stable assets. Also, It will also reserve coins to counter fluctuations.
The whitepaper reveals there will be two versions of Djed. Firstly, a minimal one, to serve as a medium of exchange, and an extended one whose smart contract uses a continuous pricing model and dynamic fees to react faster to external events.
Also, to maintain an optimal level of reserves and bring more security when performing complex operations like the ones on DeFi protocol transactions.
A Welcoming Project
Chief executive of COTI Group, Shahaf Bar-Geffen says that Djed will permit users go have control over their transactions. This is due to its stable value and low fees quality.
“Blockchain participants are using stablecoins to engage in everyday transactions because they allow monetary value to be exchange in a seamless manner, regardless of the sender and recipient’s location.”
“I believe that adding the Djed stablecoin to the Cardano blockchain will significantly improve how transactions are settled on the platform.”
Moreover, Charles Hoskinson shows expectations on the project, says it will strengthen the Cardano ecosystem.
“The Djed stablecoin could be a game-changer in the crypto space, appealing to an entirely new audience at a time when the industry is already experiencing astronomical growth.”
“COTI has been a long-time partner of the Cardano ecosystem. It’s great to have them on board with this new venture.”
Notably, This is major partnership for COTI, with 50% rise while hitting an all-time high (ATH) of $0.60 in hours.
