AgeUSD becomes the first stablecoin on the Cardano network!

AgeUSD will be the first stablecoin on the cardano network. Details are here.

AgeUSD becomes the first stablecoin on the Cardano network

A new algorithmic stablecoin, AgeUSD, will be launched on the Cardano blockchain. Multinational blockchain technology company Emurgo announced the AgeUSD stablecoin in January 2021.. Firm Ergo Foundation announced a partnership between Emurgo and IOHK’s parent company Charles Hoskinson’s Input-Output Global.

AgeUSD will soon launch on the Cardano network as a stablecoin with smart contract capabilities launched on the blockchain.

Emurgo aims to prevent problems caused by vulnerabilities in MakerDAO’s Dai collateral mechanism, such as Black Thursday. Mass liquidation of the vast majority of Maker vaults resulted in under-collateralization of Dai in March 2020.

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From AgeUSD’s “Staticoin” protocol its inspired design does not rely on collateralized debt positions (CDPs).

“The scenario that occurred on Black Thursday is not possible for the AgeUSD protocol, thanks to its design. We are not obligated to process transactions without CDPs to ensure that liquidations really work properly.”

AgeUSD Stablecoin runs on the Ergo blockchain, which aims to automate it as much as possible within the protocol’s algorithm. Reserve providers pay Ergo’s cryptocurrency (ERG) to mint reserve coins that represent underlying collateral. Users of stablecoin can also deposit ERG into reserves to mint AgeUSD. This is only allowed by the protocol if there are sufficient reserves above the reserve ratio. Banks use a similar method to lend funds.

The Cardano partnership will allow the ADA to be used as collateral to suppress reserves. However, the potential downside, according to Dai, is that the stablecoin is only supported by this ERG and ADA, while Dai is supported by multiple cryptocurrencies. . According to the roadmap, this is expected to happen in the second half of the year.

As the long-awaited update for Cardano approaches, ADA prices are starting to hit new highs.. It was last $1.55 with a new ATH on April 14. At the time of writing, ADA is trading at $1.41.

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