2023-09-05 15:06:00
Cardano is known for its consistent advancements in the stablecoin space. One of its notable offerings to the crypto space was Djed. It was the first over-collateralized ADA-backed stablecoin that operated by keeping a reserve of base coins. It also mints and burns the stablecoins and reserves coins right on the Cardano network. Recently, Djed received a new upgrade that became big news for the asset users.
Important Details About the Upgrade
The update was announced by COTI, the issuer of the Djed stablecoin. In a tweet, the mouthpiece and functionary announced about it. It also informed that the upgrade is a part of the constant improvement process of the platform. The tweet said it comes with a range of process flow optimizations. It would reduce the operational fee, minimum mint, and burn requirements as well.
Additionally, it would impact the Djed protocol’s chain index as well. It is used to reckon and quote the transaction costs. The upgrade does all that while tending to pending orders and the current state of the network. Moreover, it amps up the scalability and security of the chain index. It would curtail the errors that surface due to invalid exchange rates.
Notably, Djed was not the only application to receive the upgrade. Pub User is an application that facilitates the production and projection of the status quo of Djed. It also received an upgrade that accelerated its scalability, performance, and responsiveness.
Why Was the Upgrade Needed?
Since its launch in January this year, Djed is doing a great job like it’s supposed to. Furthermore, the protocol lost its peg in a few occurrences. It works almost impeccably while benefitting the users. However, the update beefed up the mechanism so it performs with the same efficacy in the future.
The main highlight of this update is that it will incentivize users to participate in the protocol. To make this happen, the platform has changed its fee structure. It also changed the minimum limit of tokens to be minted or burnt.
Things Users Must Know About Djed
As mentioned above, Djed works as an over-collateralized stablecoin. It works on ADA-backed stablecoin that works on contracts. These contracts maintain the peg of stablecoins to a target. They also charge fees while buying, selling, and accumulating stablecoins.
The holders of the reserve coins boost the reserve with funds. They also evaluate the risk of price fluctuations for the whole protocol. Djed is the first verified stablecoin protocol that uses lots of techniques. These methods strengthen the stability properties while enhancing the performance of the mechanism.
Key Highlights of Djed
- Using the peg upper and lower bound maintenance, the protocol keeps the price in check.
- The network sets the limit that determines the reserve ratio. It also maintains the peg even when the price falls steadily.
- The platform is impervious to insolvencies and bank runs.
- The users are getting incentives in return for redeeming their stablecoins.
Djed contributes greatly to the overall functioning of Cardano. The update is making Djed more efficient and robust. In the long run, it would also do great things for stablecoin.