Cardano's Djed Stablecoin Debuts, Offering Stability and Rewards to SHEN Holders

Stablecoin Djed has been launched on Cardano, providing stability and rewards through an overcollateralized structure and fee allocation system. Backed by Shen Reserve Coin (SHEN), Djed aims to maintain a stable peg for stablecoins and incentivize long-term token holders. Users who hold SHEN will earn rewards, and DJED's reserve ratio is designed to remain guaranteed with sufficient reserves in the contract even if ADA prices decrease.

Cardano's Djed Stablecoin Debuts, Offering Stability and Rewards to SHEN Holders

Jakarta, Indonesia – After much anticipation, Cardano's long-awaited stablecoin, Djed, has officially launched in January following its initial announcement via Twitter. This innovative stablecoin aims to provide stability and rewards for SHEN holders through its overcollateralized design and unique fee allocation system.

Overcollateralization and Stability

Djed is backed by the Shen Reserve Coin (SHEN), a "unique mechanism" developed by Cardano's Input Output Global (IOG) that maintains a stable peg for the stablecoin while incentivizing long-term token holding. By holding SHEN, users can earn a share of transaction fees on the reserve pool after collecting printing and burning fees for DJED and SHEN.

This overcollateralized structure ensures stability in DJED's value, even during market fluctuations. The reserve ratio is designed to remain guaranteed with sufficient reserves in the contract, mitigating the impact of price changes on ADA, Cardano's native token.

Rewards for SHEN Holders

All SHEN holders benefit from the system's fee allocation mechanism. Whenever a SHEN or DJED token is printed or burned, the associated fee is distributed as a reward to SHEN holders. Additionally, SHEN holders receive delegate rewards, regardless of whether they stake their tokens on the Djed platform or acquire them through decentralized exchanges (DEX) or centralized exchanges (CEX).

According to Tomer Menuchin, COTI's business development manager and DeFi researcher, SHEN has the potential to overcollateralize the Cardano ecosystem by between 400% and 800%. By providing liquidity to the reserve pool in the form of ADA, SHEN holders contribute to the stability of Djed and earn rewards for their participation.

Use Cases and Integration

Cardano envisions Djed as a versatile stablecoin with a wide range of use cases, including alternative banking, lending, and remittances. It will be integrated across the entire Cardano ecosystem, including DEX and NFT marketplaces. Ultimately, Djed is expected to become the preferred token for paying Cardano's gas fees, generating measurable transaction fees.

Staking and Rewards Distribution

Cardano has announced plans to stake the SHEN and ADA tokens held in the reserve for minting SHEN. These tokens will be allocated to a public staking pool managed by Wave Financial.

Djed 1.1.1 introduces rewards for SHEN token holders. Delegate rewards will be calculated based on snapshots taken at regular intervals and automatically distributed to eligible SHEN holders every 20 days. Holders can track their reward status and amounts through the djed.xyz website.

Ensuring Liquidity and Efficiency

To ensure the platform's success and liquidity, Djed has prioritized substantial transactions while minimizing potential bottlenecks at launch. The minimum transaction amounts for printing tokens are set at 5,000 DJED/5,000 SHEN, and for burning tokens at 1,000 DJED/2,500 SHEN.

Conclusion

The launch of Djed marks a significant milestone for the Cardano ecosystem, providing users with a stable and rewarding alternative to existing stablecoins. Its overcollateralized design, fee allocation system, and planned use cases position Djed as a promising player in the growing stablecoin market. As Cardano continues to develop and expand, Djed is expected to play a central role in the ecosystem's growth and adoption.