A few weeks ago, Cardano founder Charles Hoskinson shared with his followers that his team would soon release a new stablecoin. Recently, he shared the first glimpse of the whitepaper for an algorithmic stablecoin. The whitepaper for the new stablecoin called Djed is still not shared with the public officially. However, some initial points of the new crypto projects are shared by Hoskinson via his Twitter account.
Hoskinson claimed that a dedicated IOG team on the said project has been working tirelessly to release the stablecoin publically as soon as possible. The parent enterprise that manages the Cardano blockchain has recently changed its name from IOHK (Input Output Hong Kong) to IOG (Input Output Global). The new project has been introduced as a crypto-pegged, formally verified, and algorithmic token.
New Stablecoin will Act as an Autonomous Bank
The whitepaper excerpt shared by Hoskinson indicates that this new protocol could act as an autonomous bank. It should be noted that algorithm stablecoins are tokens with a stable price management protocol that is impervious to market trends. These algo stablecoins are usually pegged with the value of fiat, precious metals, or any other foreign currency.
The whitepaper proclaims that Djed is a novel concept since its stability has been mathematically proven. There have been many other blockchain projects that introduced personalized algo stablecoins, but most of these projects ended up failing miserably. Iron Finance is the latest example of the algo stablecoin projects going rogue. However, for Djed, a generous share of the crypto reserve will be stored to provide a hedge against price volatility.
Due to the bad history of algo stablecoins, there is not much enthusiasm found in the crypto community about the Djed project. Many have commented that a stablecoin should not be so complicated, while few commend the effort. Those who favor the Djed stablecoin believe the double verification method could make a real difference.
As per the whitepaper, Djed employs two different proof-verification protocols called model checking and interactive theorem proving. Hoskinson has also reassured his followers that the new invention is ready for public release. On the other hand, the highly anticipated smart contracts capability will soon be deployed on the Cardano blockchain.