Cardano’s new stablecoin will be available on the blockchain. It is designed to allow for Decentralized Finance (DeFi) operations without transaction fees.
Cardano’s payment gateway provider Coti will be the official issuer for Djed. Shahaf Bar Geffen, CEO of Coti, and Charles Hoskinson, Cardano founder, announced Sunday at Cardano Summit that Djed is a DeFi-focused stablecoin.
The algorithmic design of the new stablecoin uses smart contracts to provide price stability and an instrument for DeFi transactions. To pay transaction fees on Cardano, the stablecoin will be used to make transactions more predictable and avoid volatile and exorbitant gasoline fees.
Djed’s August research paper states that the stablecoin protocol will function like an “autonomous banking system that purchases and sells stablecoins at a price that is tied to a target price.” It will maintain a reserve of base coins and also mint and burn various stable assets and reserve coin.
Related: Cardano launches smart contract after a successful hard fork
Hoskinson believes that the Djed stablecoin is a game-changer for the crypto industry because it appeals to a “completely new audience” at a time when there has been astronomical growth in the sector.
This news comes just after Coti partnered Cardano’s stablecoin Hub, Ardana to bring decentralized stablecoin payment to AdaPay (a Cardano (ADA), payment gateway supporting more than 30 fiat currencies).