Proof-of-stake blockchain platform Cardano has teamed up with DAG-based Layer 1 protocol, COTI to launch an over-collateralized algorithmic stablecoin. According to reports from Cointelegraph, the stablecoin would be backed by extra collateral in the form of cryptocurrency.
- Djed will pegged to the US dollars and will be backed by Cardano ($ADA) and use $SHEN as its reserve coin.
- Crypto exchanges like Binance and Bitstamp have introduced what is known as Proof of Reserve to protect customers
$Djed Will Go Live in 2023
According to the CEO of COTI, the algorithmic stable coin, $Djed will go live on the mainnet in Jan. 2023, pending an audit and thorough stress testing. Djed will pegged to the US dollars and will be backed by Cardano ($ADA) and use $SHEN as its reserve coin.
The algorithmic stablecoin will be connected with select partners and DEXs, who will compensate users for providing liquidity with $Djed. To expand sustainably, the developers want to provide $ADA liquidity to the Djed smart contract gradually.
“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 Shahaf Bar-Geffen, the CEO of COTI shared at the official announcement at the Cardano Summit.
ADA Working on a Privacy Ledger
ADA has been working on a privacy ledger that will run independently of the ADA blockchain. The blockchain known as Midnight will operate as one of Cardano’s side-chains and enable zero-knowledge-proof smart contracts, letting transactions to be executed without divulging identifying data. Midnight’s native token is Dust.
Midnight will be rolled out in 2023 according the official handle of the parent company of Cardano, Input Output
Midnight is still in development – we’ll share updates on its progress as we continue work into 2023. In the meantime sign up on our website if you’re interested in being first to know when we have news: https://t.co/CprpAymXF9
— Input Output (@InputOutputHK) November 18, 2022
In the light of the recent of the recent FTX collapse and other happenings-a notable incident being the Terra-Luna debacle-in the crypto industry, crypto exchanges like Binance and Bitstamp have introduced what is known as Proof of Reserve to protect customers against unfortunate situations such as that of the beleaguered exchange. With $Djed launching in 2023, one can only hope it meets up with the hype.