Robert Steinadler, 2 months ago
Cardano has no viable stablecoin solution and that’s not a good thing if you like to see your DeFi ecosystem grow. But there is light at the end of the tunnel! Coti is implying that Djed could launch next week and this would boost Cardano’s ecosystem and add a lot of valuable options for traders and long-term investors.
What is Djed and what can we expect from its launch?
Djed is a decentralized stablecoin and ever since Terra and UST blew up last year investors and regulators have become suspicious about these products. The solution that is widely adopted in the crypto industry is over-collateralization. Meaning that the value of the assets that are deposited to peg the value of the stablecoin have to be multiples.
In the case of Djed, that means that each stablecoin is secured by between 400% and 800% of the needed value to ensure its peg is maintained at all times. If you like to know more about how Djed exactly works, we have all information you’ll need in the linked article.
Of course, there is no guarantee that the peg will be stable at all times, but most experts believe that an overcollateralized stablecoin is the best solution that can be offered. The next best solution would require a centralized entity that holds an equal amount of cash for each stablecoin that is emitted. As we all know this is not easy to achieve and even centralized stablecoins are often secured with other assets such as treasury bills.
According to Coti, the ecosystem is already signaling its readiness to adopt Djed. Decentralized application such as MuesliSwap has announced their full support. They promise that once Djed is launched it will be integrated into their marketplaces and products.
This is an exciting development for Cardano even though it is not clear when the stablecoin is going to launch exactly. Since Cardano has a long history of postponing releases and launch dates, it might be a good idea not to get too excited until the launch is happening.
Stablecoins have become increasingly important in crypto. They allow to denominate and trade assets, goods as well as services in dollars or euros, diversification of portfolios, and lending and borrowing money. This trend is also reflected by their market cap. Three of the top 10 assets are stablecoins, which hints that Djed as well as Cardano could see some growth by starting their version of a stablecoin.
Nov 22, 2022
Last weekend in Edinburgh, Cardano's parent company announced its new sidechain Midnight. It will be a smart contract blockchain that allows users to exchange data without revealing more than they want to. Cardano expects businesses to be interested in Midnight. One of the reasons business shy away from public blockchains, is precisely their lack of privacy.
Nov 18, 2022
Cardano is developing its second-layer protocol dubbed Hydra that is meant to improve its scalability similarly like the Lightning Network is doing with Bitcoin. Recently, Hydra made some progress with a specific development that could boost Cardano and bring micropayments to the masses.
Nov 11, 2022
Cardano has been late to the NFT party and one of the reasons was the fact that its technical development took longer than expected. Many critics called Cardano a “ghost chain” for its lack of a DeFi and NFT economy. It seems that this assessment is far from being correct and while we are still facing a brutal bear market, Cardano NFT ecosystem is doing great.
Sep 05, 2022
White smoke from the Cardano camp, finally! After an earlier delay, Cardano parent company Input Output announced the Vasil hardfork to happen on September 22. It will mean more capacity and more elbow room for developers to build powerful applications.
Sign up to stay informed via our email updates