Cardano ($ADA) Network Reaches New Milestone With First Stablecoin Launch
The stablecoin native to the Cardano ($ADA) network has recently been launched along with other synthetic assets via the Indigo Protocol on the cryptocurrency’s blockchain. The Indigo Protocol was launched to issue decentralized synthetic assets on Cardano.
According to an announcement from the protocol, synthetic assets were recently launched along with iUSD, a stablecoin whose value is pegged to that of the U.S. dollar. Currently, the protocol only allows users to mint iBTC and iUSD, tracking the value of BTC and the USD respectively.
The protocol’s documentation notes that Indigo creates “synthetic assets which are known in the protocol as iAssets (i.e., “Indigo Assets”). iAssets are cryptocurrency assets that derive their prices from tracked assets.” These assets aren’t wrapped versions of other assets, and instead “use a price Oracle to track the price of the underlying asset.”
Per the protocol anything “that has a real world price can be turned into an iAsset. Adding more iAssets is the responsibility of DAO Members.” To mint new iAsssets, users have to deposit a specific amount of $Ada, Cardano’s native token, as collateral. The collateral is then used to open a Collateral Debt Position (CDP) and mint their desired iAssets.
As CryptoGlobe reported, other stablecoins are being created on the Cardano network. EMURGO, which is the commercial arm of Cardano, announced the planned launch of its new dollar-backed stablecoin USDA, which is “the first fully fiat-backed, regulatory compliant stablecoin in the Cardano ecosystem,” earlier this month.
According to EMURGO’s press release, USDA “leverages the stability of the U.S. Dollar combined with Cardano’s security, low fees, and eco-friendly blockchain” and offers “locks in the value of investors’ crypto assets by pegging 1:1 to the U.S. dollar, reducing volatility, and unlocking fast global transactions without legacy banking and payment infrastructure delays.”
Similarly, a Cardano-powered algorithmic stablecoin called Djed ($DJED) is set to launch early next year on the smart contract platform’s mainnet, according to an announcement developers made at the Cardano Summit in Lausanne, Switzerland.
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