Today, some relatively big news is shaking up the decentralized finance (DeFi) world. As a key competitor to Ethereum (CCC:ETH-USD), Cardano (CCC:ADA-USD) has seen increased interest recently. The ability for crypto investors to benefit from smart contracts and the burgeoning DeFi network built on Cardano has enticed many investors to consider ADA over ETH.
Today, that discussion is continuing.
Cardano announced earlier today that it would be partnering with COTI (CCC:COTI-USD) to bring the first stable coin, Djed, to its network. This announcement provides significant credence to the idea that the Cardano blockchain can compete with the biggest out there. As far as DeFi crypto plays go, Cardano is perhaps number two, only to Ethereum. However, the introduction of a stable coin could be the catalyst that propels Cardano into the stratosphere.
Perhaps that’s wishful thinking. However, let’s dive into why investors may want to know more about this stable coin right now.
Why Cardano Crypto Is On Watch Right Now
The introduction of this new Djed stable coin to Cardano’s network is significant for a number of reasons. Here are the key elements investors are paying attention to right now:
- Cardano’s payment gateway provider Coti has announced it will be the official issuer of Djed.
- This stable coin will help facilitate transaction fees on the Cardano network.
- Thus, Cardano users can expect more stable and consistent fees.
- Exorbitant gas fees have been a key pain point for Cardano and Ethereum users of late.
- Accordingly, investors seem to like the algorithmic nature of this stable coin in what it brings to the Cardano network.
- By holding a reserve of base coins and minting and burning various coins, Djed will “act like an autonomous bank that buys and sells stable coins for a price in a range that is pegged to a target price.”
- Investors like the fact that the smart contracts Cardano’s network supports are being used in a way that benefits investors.
On the date of publication, Chris MacDonald did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.