CEO of COTI Discusses Exciting Launch Strategy for Stablecoin ‘Djed’


In a recent interview, Shahaf Bar-Geffen, the CEO of FinTech firm COTI Group and the issuer of the algorithmic stablecoin Djed (which is based on Cardano), discussed the much-awaited debut of the project.

Djed, an officially certified crypto-backed pegged algorithmic stablecoin for Cardano, was devised by blockchain technology company IO Global (IOG) and released by FinTech startup COTI Group on the second day of the two-day Cardano Summit 2021 (26 September 2021).

The usage of smart contracts by Djed assures pricing stability. Djed is applicable in decentralized finance (DeFi). Keeping a reserve of base coins and minting and burning stablecoins and reserve coins is how it operates.

The following is the abstract from IOG’s white paper for Djed, which was published on 17 August 2021: This article introduces Djed, an algorithmic stablecoin protocol that functions like an autonomous bank that buys and sells stablecoins at a price range fixed to a target price. It is crypto-backed in that the bank reserves a volatile coin.

The reserve is used to purchase stablecoins from sellers. And money from stablecoin sales to users is deposited into the reserve. The bank trades reservations in addition to stablecoins in order to maintain a reserve ratio much larger than one.

According to the authors, “to the best of our knowledge, this is the first stablecoin protocol whose stability promises are properly articulated and mathematically validated. The claims and their proofs are also formally validated by using two methods: limited model checking, which searches exhaustively for counter-examples to the claims, and interactive theorem proving, which uses a proof assistant with automated theorem-proving capabilities to provide rigorous formal proofs.

Djed, according to a blog article published by IOG on September 26, 2021, “operates by keeping a reserve of base coins, while minting and burning various additional stable assets and reserve currencies,” and “it is meant to be used for paying transaction fees on the Cardano network,” which helps “make transaction costs more predictable, therefore avoiding fluctuating and expensive gas prices for consumers.”

The COTI team thinks that “stablecoins are a ‘killer app’ that will be accepted by a significant number of crypto users for payment settlement and fee payment.”

Also Read: Update on the Ripple v. SEC lawsuit as of December 26, 2022

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