When DJED launches, will it face the same depeg threat as UST, FEI, and other coins? DJED is Cardano's first algorithmic stablecoin.
According to a post on COTI's official blog, the ADA-backed stablecoin will launch on the mainnet as soon as the chain index synchronisation procedure is finished.
DJED, the native stablecoin for the Cardano (ADA) network, was formally established on January 31 by layer-one protocol COTI. Due to its overcollateralized structure and fee allocation approach, the Djed stablecoin is said to give more stability and incentives to investors. Its debut is expected to enhance the total value locked (TVL) on the Cardano ecosystem.
The ADA-backed stablecoin will go live on the mainnet as soon as the chain index synchronisation process was complete, according to COTI's official blog post. The technological procedure, according to COTI, began one week ago and took roughly 14 days to complete. The paper also highlighted the technologies that will be included in the stablecoin with additional updates following the initial launch.
Similar to that, it is now possible to cancel an order. Users will be able to utilise the ability to cancel a transaction by clicking the refund button as long as it hasn't been executed.
Since the TerraUSD (UST) algorithmic stablecoin fiasco in May 2022, many cryptocurrency users have grown apprehensive of dealing with algorithmic stablecoins. Ten times steeper than it was prior to the Terra crash, the market for this industry has undergone a tremendous decrease.
This hasn't stopped the Cardano network developers from moving forward with the launch of the stablecoin for the ecosystem on January 31. According to a recent announcement, the DJED development team has done significant research into the flaws related to algorithmic stablecoins like UST, FEI, and MIM and has been working on them to prevent the cryptocurrency from encountering a situation similar to that. DJED is backed by the original cryptocurrency created by Cardano, ADA, and it is fixed at the price of one US dollar. The reserve currency for this platform is the Shen (SHEN) token.
Djed will first serve as a decentralised bank that supports a wide range of use cases. The creation of Djed Pay, which will let users pay retailers with the stablecoin, is currently being worked on by COTI. Remittance, lending, and alternative banking are some more use cases for blockchain technology. In addition, Djed will eventually develop into the currency that would be used to pay for all Cardano gas fees, according to plans that were made public by IOG. This will make it possible to have consistent and steady transaction costs rather than volatile gas prices.
Djed will also be listed on exchanges at the time of its debut, according to COTI's confirmation. A centralised exchange called Bitrue recently said that DJED and SHEN will both be featured on the platform's spot markets when it launches. Furthermore, Wingriders, a partner of Djed's decentralised exchange (DEX), was mentioned by COTI as having also suggested listing the stablecoin. The Cardano blockchain has recently released a number of updates, with this one being the most recent. Among these updates is one published on January 12 by co-founder Charles Hoskinson, who stated that the ecosystem will grow through specially created sidechains.
In the meanwhile, this update has caused the price of Cardano (ADA) to soar, mirroring the rise in the value of all cryptocurrencies. ADA's price has increased by 4.36% over the last twenty-four hours, and it is currently trading at approximately $0.3926.
