In the midst of the recent stablecoin market turmoil, Cardano’s Djed stablecoin stood out as a reliable entity that did not lose its USD peg. In fact, it traded at a premium against the USD at one point, demonstrating its resilience during periods of high demand. Meanwhile, other stablecoins like USD Coin, DAI, and FRAX lost their dollar peg.
One of the reasons for Djed’s stability is its over-collateralization mechanism, with each Djed backed by more than four times its value in ADA. Djed’s reserve ratio stood at 487%, and it had over 33 million ADA coins in reserves. However, as a newcomer to the stablecoin horizon, its trading volume was still a fraction of more established coins like USDC and DAI.
Despite this, Djed’s total value locked (TVL) saw gains of 17% since the USDC de-pegging saga, according to data from DeFiLlama. At present, it accounts for 8% of the total TVL on the Cardano blockchain.
The potential for Djed’s expansion is also significant, with plans to launch on other layer-1 networks like BNB Chain and Ethereum. COTI, the firm that developed Djed in collaboration with Input Output HK, has received several requests from non-Cardano DeFi protocols to have the stablecoin launched on their blockchains.
The CEO of COTI noted that the expansion was always part of the project scope, and they will work towards it with greater focus. Djed’s contribution to ADA is also noteworthy, as it plays a significant role in the Cardano ecosystem. At present, ADA trades at Djed Stablecoin’s Resilience and Potential for Expansion Amidst Stablecoin Turmoil.
Cardano Price Analysis
At present, ADA trades at $0.3758, with bullish sentiments for the coin on the rise as the number of long positions increases vis-à-vis short positions.
Cardano is up 12.56% in the last 24 hours and is looking to break the $0.4000 resistance level in the near future.ADA has formed a bullish pennant on the 4-hour chart, indicating that it is ready to move higher in the near future. The RSI and MACD are both signaling bullish momentum for ADA.
Djed’s resilience amidst stablecoin turmoil and its potential for expansion to other layer-1 networks make it an entity worth watching in the stablecoin market. While still a newcomer, its over-collateralization mechanism and reliable performance bode well for its future growth and contribution to the Cardano ecosystem., with bullish sentiments for the coin on the rise as the number of long positions increases vis-à-vis short positions.