2023-7-5 13:34 |
Cardano-based stablecoin Djed (launched in January 2023) is causing issues associated with de-pegging. Moreover, users are encountering token un-minting challenges. Djed has de-pegged on all Cardano decentralized exchanges (DEXs) as its reserve ratio plunges beneath desired levels.
REPORT: $DJED, the stablecoin issued by Coti; has failed to maintain a reserve ratio between 400-800% making it un-mintable through the $DJED protocol for users, which has caused a consistent de-pegging on all #Cardano DEXs with $DJED trading at a price of $1.078 as of writing. pic.twitter.com/mZLUd0E2bC
— The Cardano Times (@TheCardanoTimes) July 5, 2023 Djed stablecoin de-pegs after reserve ratio dipThe Cardano Times (TCT) has confirmed that Djed’s reserve ratio has plummeted beneath the range that ensured stablecoin stability. The token should maintain between the 400% and 800% zone for constant parity with the United States dollar.
TCT’s Wednesday tweet shows that stablecoin’s reserve ratio dipped to 346%. Moreover, its base reserve had approximately 11,555,202 Djed coins (around 39,343,556 ADA).
That has triggered hurdles for players to un-mint tokens via the Djed protocol. Meanwhile, the COTI-issued stablecoin had de-pegged across Cardano DEXs.
Furthermore, TCT posted a graph showing Djed’s trading history over the past month (June), stating the market participants can’t purchase the token at $1.
While some community members criticize Coti for failing to ensure adequate Djed liquidity. The Cardano Times has explained that the token only lost pegs on Cardano decentralized exchanges – not on the stablecoin’s protocol.
While the protocol’s burn mechanism helps maintain a $1.00 price tag, interacting with DJED at current situation remains impossible.
Looks like interaction with the protocol has stalled;
Mint DJED – not possible
Burn DJED – possible but why burn when you can sell it at a premium on secondary?
Mint SHEN – possible but see below
Burn SHEN – not possible
Cardano has shown resilience despite SEC-induced woes. Invezz.com reported that leading trading platforms such as Robinhood and eToro delisted top altcoins, including Cardano. While backlash from renowned brokers ruined sentiment, the token has held firm, fluctuating according to broad-based market movements.
Cryptocurrency prices have presented sideways actions lately. Meanwhile, Cardano has showcased impressive strength with continued rebounds amid the delisting spree. The coin reclaimed the $0.3 mark before plunging to press time levels of $0.2879.
Considering the current performance, Cardano seems prepared for future capitulation and possible de-listings. Nonetheless, enthusiasts should beware that the asset retains bearish tendencies. IntoTheBlock data shows deteriorated investor sentiment, according to derivatives, exchange, and on-chain signals.
Source – IntoTheBlockThe post Cardano stablecoin DJED de-pegs after failure to maintain reserve ratio appeared first on Invezz.
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