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Why Being the Issuer of Djed, Cardano’s Official Stablecoin, is a Game Changer for COTI

As just revealed during the Cardano Summit by none other than Charles Hoskinson, Cardano’s founder, COTI will become the official Djed issuer, Cardano’s new stablecoin.

Djed is a stablecoin based on an algorithmic design. It uses smart contracts to ensure price stabilization, and the coin will be useful for decentralized finance (DeFi) operations.

It operates by keeping a reserve of base coins, and minting and burning stablecoins and reserve coins.

Djed isn’t just a stablecoin built upon Cardano’s chain, it is also designed to become the ultimate coin with which Cardano’s entire network transaction fees will be paid. It makes more sense for a chain to have predictability in how much transaction costs, rather than have volatile gas fees, and Djed will do just that.

We have already stated our intention for COTI to dedicate special efforts to stablecoins during our growth plan presentation last August. We believe that stablecoins are a killer app that will be massively adopted for payments and fees.

While our main goal is to issue stablecoin for enterprises and merchants on COTI’s Trustchain, we also plan on being involved with stablecoin issued on other chains. Our long relationship with Cardano, leading to an equity investment by their ecosystem fund, has created the opportunity for COTI to become the official issuer for Djed, Cardano’s stablecoin.

As part of COTI’s role, COTI is in charge of developing the user interface system and will operate the integration between users to the smart contracts for the stablecoin. COTI will partner with enterprises, developers, and others parties who wish to mint both the stablecoin and the reserve coin used as part of the pegging algorithm.

$DJED and its reserve coin’s mint and burn fees will be charged in $ADA and will be entered into the equity pool of the protocol. The reserve coin holders get a share of this pool as an incentive for their participation in maintaining the $DJED peg ratio.

As the provider of this service, users will be subject to operating fees that will be paid in $ADA and deducted from the initial deposit and operational costs. We plan on converting such $ADA fees to $COTI coins, initially by buying $COTI directly in the market and supporting the demand for $COTI, then by depositing such $COTI in COTI’s Treasury, for the benefit of the Treasury users. It’s a real win-win and a great opportunity for the COTI ecosystem.

We predict that the Djed issuance accumulated fees will be substantial, as Cardano is the 3rd largest coin in terms of market capitalization and also because Djed will ultimately be used for all the transaction fees paid on Cardano. The potential is breathtaking!

Visit https://djed.xyz/

Read here the announcement published by IOHK.

Stay COTI!

For all of our updates and to join the conversation, be sure to check out our channels:

Website: https://coti.io

Twitter: https://twitter.com/COTInetwork

Telegram: https://t.me/COTInetwork

Github: https://github.com/coti-io

Discord: https://discord.me/coti

Technical whitepaper: https://coti.io/files/COTI-technical-whitepaper.pdf

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