During the Cardano (ADA/USD) Summit, founder Charles Hoskinson announced COTI would be the official issuer of a new stablecoin for the Cardano system, based on the Djed protocol, Invezz learned from a press release. Cardano is one of the biggest blockchain platforms in the world with the third-biggest market cap for the cryptocurrency.
COTI is designed to meet DeFi and CeFi challenges
COTI is a full-scale “finance on the blockchain” ecosystem, aimed at solving issues typical of centralized finance such as latency, fees, risk and decentralized finance (complexity, clogging, fees, etc.) It does this by implementing a new type of DAG-based infrastructure and base protocol that is private, affordable, scalable, inclusive, fast, and finance-optimized.
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Charles Hoskinson, CEO of IO Global said:
“The Djed stablecoin could be a game changer in the crypto space, appealing to an entirely new audience at a time when the industry is already experiencing astronomical growth. Djed shares our commitment to formal verification, proving a robust method of combating price volatility of crypto markets. COTI has been a long time partner of the Cardano ecosystem, it’s great to have them on board with this new venture.”
Djed maintains reserve of base coins while letting users mint and burn
The Djed stablecoin protocol maintains stable prices by leveraging smart contracts. Its algorithmic design includes smart contract programming to make sure the stablecoin will support DeFi transactions. Djed works by maintaining a base coin reserve while allowing users to mint and burn stablecoins as well as reservecoins. Its creators share plans to potentially implement Djed on Cardano to generate stablecoins. This approach would pay Cardano network use fees (transaction fees) through a “Babel fees” type mode.
Shahaf Bar-Geffen, CEO at COTI Group, stated:
“The stablecoin ecosystem has matured tremendously over the past few years. Blockchain participants are using stablecoins to engage in everyday transactions because they allow monetary value to be exchanged in a seamless manner, regardless of the sender and recipient’s location. I believe that adding the Djed-based stablecoin to the Cardano blockchain will significantly improve how transactions are settled on the platform.”
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