After a year of preparation, which was mostly shrouded in secrecy, the cryptocurrency community has lived to see the launch of another stablecoin. It is the algorithmic Djed, built on Cardano with the support of the Coti protocol.
Coti reports: DJED is now with us!
Coti is a tier one protocol, which, being the official issuer of the newly created coin, provides support for Cardano. The Djed in question was launched on the last day of January. With that, Coti representatives took to Twitter to officially unveil it.
According to the information, the stablecoin’s launch comes after a year of preparation, security audits and tracking potential paths for its development:
“After more than a year of preparation and development, and a successful security audit, we are very proud to announce that Djed, the overly correlated stablecoin on Cardano, is now live on the mainnet.”
This announcement came in line with market expectations. Recall that Coti representatives assured that Djed would be released before the end of the week. And here it is!
Is DJED immune to the difficulties that UST did not survive?
The topic of algorithmic stablecoins sends shivers down the skin of many investors. Recall that the most famous of the projects, created on the basis of similar assumptions, collapsed last May. It was UST, which was backed by other cryptocurrencies, such as Terra LUNA, while secured by Bitcoin. The venture, however, was a failure, leading to the complete decorrelation of UST with the US dollar, whose value the coin was supposed to reflect. This also resulted in the collapse of LUNA, a project that had previously managed to generate so much interest among investors that it was among the top ten coins with the highest market capitalization.
It turns out, however, that DJED has a completely different premise, and its main asset is supposed to be over-correlation. We are talking about the security, which is expected to be between 400% and 800%. The strength of stablecoin is also supposed to be the unique proof of reserves. These features are intended to keep DJED at $1 and protect it from various market scenarios.
Details of DJED’s security and first listings on decentralized exchanges
The base coin that supports DJED is ADA. However, a much more important role will be played by SHEN, which is a reserve coin. If a situation arises where the reserve ratio falls below 400%, the protocol will automatically halt the firing of SHEN and the creation of new DJEDs. It will also not be possible to mint new SHEN when the reserve ratio exceeds 800%.
Later that day, COTI confirmed that DJED became available on Cardano-based decentralized exchanges. They include WingRiders, MinSwap and MuesliSwap. The listing of DJED and SHEN on centralized platforms has not yet taken place. Nonetheless, Bitrue, a Singapore-based exchange, is expected to be the first to be interested.