Recently you could read in the Cardano news that the algorithmic stablecoin Djed will be launched next week on Cardano (ADA). The stablecoin was developed by Input Output Global (IOG), the organization behind the development of Cardano, and Coti, a layer-1 blockchain.
Djed is designed so that it overcollaterized is, meaning it is backed by excess collateral in the form of a cryptocurrency held in reserve. Also referred to as Shen, this crypto will cover ADA price fluctuations to ensure price stability. Djed will be 400% secured, which means that for every dollar of Djed there will also be 4 dollars of collateral ready.
Cardano DEX listings
The Cardano based decentralized exchanges (DEX) Muesliswap and MinSwap both have announced their support for Djed and the accompanying governance token shen. They have both indicated via Twitter that they will listen to Djed and Shen on their DEX.
According to DeFiLlama, MinSwap is currently the largest Cardano DEX with a total value locked (TVL) from $32.38 million. Muesliswap has a TVL of $6.8 million.
Decentralized exchanges rely on smart contracts to match transactions between users anonymously, without the involvement of a third party. These users provide liquidity to trading pools and earn rewards in the form of tokens.
The Djed tokens are expected to attract liquidity and interest from investors due to their overcollaterized mechanism, which could generally benefit Cardano’s decentralized finance (DeFi) market, which currently has a TVL of $79.20 million.
Yield rewards
A developer of Muesliswap has indicated that concentrated liquidity Polish, equivalent to Uniswap’s, will be launched. He expects the trading Annual Percent Rate (APR) itself will be above 10% and he also indicated what the expectations are with regard to the farming APR:
”We aim for a minimum of 10%-15% for farming APR for both the ADA/DJED and ADA/SHEN pairs. So overall, we’re aiming to be above 20%-25% APR in the first month to attract liquidity.”