According to the teams of Cardano, AgeUSD It will be a stablecoin whose operation will be algorithmic, which will guarantee its value mathematically and will be much more efficient than other proposals on the market.
IOG, the company that supports the project technologically Cardano, announced a collaboration with Emurgo and the Ergo Foundation to carry out the launch of the first stablecoin for him Blockchain from Cardano, which will be known as AgeUSD.
This was indicated by the team IOG in conjunction with Emurgo, which added that the new stablecoin It will have different properties to many of those already known in the market, precisely because it will implement algorithmic principles to guarantee its value, and that AgeUSD will be available once the network Cardano have support for smart contracts.
AgeUSD: The first stablecoin algorithmic for Cardano
Regarding its operation, the team of IOG explained that for the development of AgeUSD They will implement a model of innovative solutions to guarantee their value and stability, supporting these aspects through the use of algorithms instead of guarantees as is the case with other market exponents.
Reviewing a little the operation of certain stablecoins, those like Tether The USDC They manage to guarantee their parity with the US dollar because they have the amount of money equivalent to the number of circulating tokens in a bank account, which is audited every so often to ensure that there is parity between the issued cryptocurrencies and the capital of back.
On the other hand there are exponents like DAI, which accept other cryptocurrencies as counterparties, but finances may be affected if these endorsements lose value.
With respect to AgeUSD, The proposal consists of a rule-based approach that determines the value of each token, thereby reducing its exposure to the volatility of the cryptocurrency market. About, Emurgo indicated that the idea is “Automate as much as possible mathematically the protocol itself, instead of depending on the publication of dynamic transactions that could be vulnerable to overloading a Blockchain network.”
The need for stablecoins in the market
From the start of the first stablecoin to the market, they quickly saw great adoption both inside and outside the cryptocurrency space precisely because of the utility they offer when carrying out financial operations in different areas.
For those who want to buy and sell products on the Internet, pay with stablecoins It is quite profitable in the sense that they are payment mechanisms that are not subject to the control of companies, banks or financial applications, which often apply restrictions and / or high commission margins to transactions.
While, for those who trade cryptocurrencies, the stablecoins They represent a very good leverage mechanism when it comes to ensuring profits, especially since these assets fluctuate minimally in the face of the volatility registered by the main digital currencies in the market.
Given the Cardano It will soon integrate smart contracts within its network, this will open space for a large number of use cases, especially within the decentralized finance sector, where large amounts of capital are moved by way of commercial operations that are carried out exclusively with cryptocurrencies.
Plans for Cardano
While there are strong expectations around the next update for the network, known as “The era of Goguen”, nowadays Cardano It is listed as one of the projects with the best technological development among those that aim to further explore the benefits that technology offers Blockchain.
As such, while Ethereum registers operational problems and their teams are working on the development of version 2.0, the conflict between the networks grows Blockchain that could appear as the new protagonists within this ecosystem, among which Cardano It is listed as one of the best options due to the strength and benefits of its proposal, which is progressing steadily to offer support to a greater number of use cases.
Recently, in February of this year, a major update took place that already allows the network to offer support for new native tokens. In turn, yesterday, the Cardano Foundation opened a registry for digital assets in which all important information associated with the different responsible projects would be outlined, in order to guarantee their verifiability and the transparency of operations.
The next big update is expected to Cardano come to place in the next few months. Meanwhile, your native token THERE IS It is priced at USD $ 1.43 per unit, ranking sixth in the ranking of cryptocurrencies with the highest market capitalization.
Version by Angel Di Matteo / Daily bitcoin
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Cardano announces that it will soon launch AgeUSD, the first algorithmic stablecoin that will operate on its network – DiarioBitcoin