The Djed stablecoin will soon be released on Cardano, and it must promote the growth of its underlying ecosystem, particularly now that blockchain smart contracts are being implemented. The market's expectation is growing as the possibility of developing DeFi platforms becomes more feasible. If Cardano wants to steal Ethereum's thunder, smart contracts, DeFi, and stablecoins are essential.
How do stablecoins work?
A stablecoin is a cryptocurrency that was created to maintain a consistent value in the face of a volatile market. The most well-known stablecoins are cryptocurrencies such as USDT and USDC, which are linked to fiat currencies such as the dollar and the euro. There are also stablecoins with a 1:1 correlation to commodities such as gold (Digix) or even other cryptocurrency's or a collection of cryptocurrency's.
There are a variety of methods for ensuring that the stablecoin has the appropriate value; the one that works best is the one that uses the least amount of energy.
"Djed works in a different way."
In the case of Djed, he will be investigated. They use an algorithm that makes use of smart contracts to keep the value as close to one dollar as possible. To do so, Djed has a crypto reserve on hand while other coins are mined and branded; also, extra coins are always reserved to protect against fluctuations. This appears to be a really unusual way to keep a one-dollar coin.
Stablecoins change the way transactions are done.
Shahaf Bar-Geffen of COTI Group stated at the conference that by using a stablecoin like Djed, users will be able to maintain more control over their transactions due to the stable value and low costs.
'Blockchain-members use stablecoins to carry out daily transactions since they ensure that money may be sent and received anonymously, regardless of the location of the sender and receiver. I believe that adding the Djed stablecoin to the Cardano blockchain will improve the way in which transactions on the platform are recorded accurately.'
Charles Hoskinson is also a fan:
'The Djed stablecoin has the potential to be a game-changer in the crypto-space, accessible to a whole new audience at a time when the industry is seeing unprecedented expansion.' The Cardano ecosystem has long been a proponent of COTI. It's wonderful that they've decided to join us in this new initiative.'
