Djed, the first algorithmic stablecoin of layer-1 blockchain Cardano, is expected to go live on the mainnet early next year, announced the development team at Cardano Summit in Lausanne (Switzerland).
According to the announcement, Djed is an algorithmic stablecoin pegged to USD, backed by Cardano ($ADA), and will use $SHEN as its reserve coin. Djed’s algorithm is based on a collateral ratio in the range of 400%-800% for $Djed and $Shen. To mint 1 $Djed, users need to send 0.5 $ADA to the contract. If the ratio falls below 400%, users will not be able to mint $Djed, and $Shen holders won’t be able to burn their $Shen. So in the event of a market dip there is a security blanket for $Djed holders that ensures its sustainability.
Djed was developed for over a year by Coti and the developer Cardano Input Output Global. The project will gradually integrate Djed with partners and decentralized exchanges (DEX) in the future.
“Recent market events have proven again that we need a safe haven from volatility, and Djed will serve as this safe haven in the Cardano network. Not only do we need a stablecoin, but we need one that is decentralized, and has on chain proof of reserves”, said CEO Coti Shahaf Bar-Geffen at the Cardano Summit.
40 projects on Cardano ecosystem are ready to integrate Djed. In addition, DjedPay – a service that allows Djed payments will also be released at the same time. After the news, ADA price has increased slightly by 1.82% over the past 24 hours and is trading around $0.3.
Besides Djed, Cardano will also launch USDA in early 2023. This is the first fully fiat-backed, regulatory-compliant stablecoin in the Cardano ecosystem. The company also leaves open the possibility of issuing new blockchains and tokens, both ensuring privacy and opening access for regulators and auditors.
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