Cardano gets its first USD-backed Stablecoin
Cardano will finally have its own fiat-backed stablecoin after one of its founding entities, EMURGO, announced that the USDA stablecoin will launch on the proof-of-stake network in the first quarter of 2023.
EMURGO announced on November 18 that the stablecoin would be fully regulatory compliant and designed to protect Web3 participants from the inherent volatility of the crypto market. The US dollar will fully support the stablecoin to ensure it provides long-term price stability.
EMURGO’s USDA Stablecoin shall be fully backed by USD
EMURGO said it has a partnership with an unnamed regulated financial company in the United States that will act as a depository for cash deposits. It also noted that USDA would be the first product to come from the new suite, Anzen. This suite will focus on connecting traditional financial services to crypto.
Through the Anzen portal, users can tokenize their dollars and spend them on the Cardano blockchain network. Plans for Anzen include lending and borrowing, bridges between dApps and traditional finance, and crypto debit cards.
EMURGO’s Fintech Managing Director Vineeth Bhuvanagiri said:
“This stablecoin not only provides stability to investors conducting financial transactions on the blockchain, but promotes a path forward for the Cardano ecosystem to solve a problem we are uniquely positioned to solve – banking by underbanks.”
The launch of USDA is set for Q1 of 2023, and EMURGO plans to enable the tokenization of other stablecoins, such as USDT and USDC, to USDA. It also revealed intentions to enable the conversion and exchange of cryptocurrencies such as Bitcoin and Ethereum.
The Cardano community has welcomed the new announcement. Other stablecoins may also have launched on Cardano before the arrival of the USDA. Djed stablecoin is planned for Q4 2022.
Talks of a Cardano-based stablecoin have been going on for some time. Several analysts have predicted that it would help push Cardano’s decentralized finance (DeFi) ecosystem, which currently has a TVL of $53.32 million – miles away from its peak of over $300 million in March.
Meanwhile, other developments are also underway on Cardano. Charles Hoskinson recently revealed that the network is about to enter the Age of Voltaire phase. In this phase, the network will push for a more decentralized decision-making process – the first Cardano Improvement Proposal (CIP) is already live on GitHub.
Charles Hoskinson Introduces ‘Midnight’ Private Blockchain
Charles Hoskinson has also stated in an interview with Coindesk, that Input Output Global (IOG), which is the company behind Cardano, plans to implement a new blockchain and token for privacy. The new privacy-focused blockchain will be called “Midnight”, while the token accompanying the private blockchain will be called Dust. Hoskinson told Coindesk: “Midnight has developed private coin technology where everything was anonymous by default, which is what Zcash and Monero did with Snarks and ring signatures.”
The Cardano CEO mentioned the new private blockchain differs from the likes of ZCash and Monero by being written in “a normal programming language, not some weird Snark thing, but JavaScript or something like that, something developers can understand and get a guarantee that you have privacy.”
Cardano ADA Price Performance
However, this wave of development has yet to translate into positive price performance for Cardano ADA. According to CoinMarketCap data, the digital asset has yet to recover from FTX’s recent crash. As of press time, it is trading at $0.3253 after falling 1.59% in the last 24 hours.
For BeInCrypto’s latest Bitcoin (BTC) analysis, click here.
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