The Rise of Djed: The First Stablecoin to Use Formal Verification

As the world moves towards a more digital economy, the need for stable cryptocurrencies has become increasingly apparent. With traditional cryptocurrencies experiencing significant price volatility, it becomes difficult for businesses to adopt them as a unit of exchange in their day-to-day operations. This is where stablecoins come in, they are cryptocurrencies that are pegged to a more stable asset, such as a fiat currency or a commodity, and aim to eliminate price volatility.

Enter Djed, a stablecoin that uses formal verification to ensure its stability and eliminate price volatility. Djed is part of Cardano’s vision of “Realfi” and provides a transparent and secure alternative to other stablecoins in the industry. Unlike other stablecoins that lack transparency and have questions about the liquidity of their reserves, Djed is mathematically verifiable and operates in a transparent manner on the blockchain. This means that anyone can verify the protocol’s behavior and how it maintains its stability.

Djed works by keeping a reserve of base coins and minting and burning stablecoins and reserve coins. A smart contract is in charge of maintaining the peg to a stable asset, such as the US dollar, by buying and selling stablecoins and using the reserve. This stablecoin operates as a decentralized bank and provides several benefits to users, including:

  • Peg upper and lower bound maintenance: The price of Djed will not go above or below a set price, for example, if the price of a Djed pegged to the US dollar rises to $1.01, the smart contract will automatically sell to maintain the stable price of $1.00.
  • Robust peg during market crashes: The peg is maintained even during market crashes, up to a set limit that depends on the reserve ratio.
  • No insolvency: Djed operates without a bank, so there is no risk of insolvency.
  • No centralized banking institution: In case the peg is lost, users are not incentivized to race to a bank. Instead, the smart contract fairly pays out users who want to trade back to their base coin.
  • Monotonically increasing equity per reserve coin: Under certain conditions, reserve coins are guaranteed to increase, allowing holders to profit.
  • No reserve draining: It is impossible for bad actors to steal reserve coins from the smart contract under certain conditions.
  • Bounded dilution: The profit of reserve coin holders is limited and can be diluted due to the issuance of new reserve coins.

Coti and Its Role in Djed

In September, Charles Hoskinson and Coti CEO Shahaf Bar-Geffen announced at the Cardano summit that Coti would be the official Djed issuer. Coti will write all Djed contracts and run the front end, interacting with funds, enterprises, or anyone who wants to mint reserve coins and stablecoins. Coti will collect fees for this service, both for minting and burning stable and reserve coins.

Djed is not only a stablecoin, but it is also designed to be the main coin for the Cardano network to pay all its fees. As Djed is stable, it makes more sense to pay gas fees with it instead of a volatile asset. Shahaf believes that adding the Djed stablecoin to the Cardano blockchain will significantly improve transaction settlement on the platform. Coti predicts that Djed’s accumulated fees will be sustainable as Cardano’s market cap continues to grow.

Formal verification for Djed has been proven on an automated theorem prover called Isabelle. This platform allows users to prove mathematical theorems in formal languages, and Djed has been implemented in the ERGO blockchain.

In conclusion, the integration of Djed as a stablecoin into the Cardano blockchain represents a significant step forward in the crypto industry. With its use of formal verification, it offers unparalleled stability and transparency compared to other stablecoins. The algorithmic design ensures that the price remains pegged to a stable asset, and eliminates the need for a centralized banking institution.

Coti, as the official Djed issuer, will play a critical role in the success of the stablecoin. With its team’s focus on stablecoins and their predicted growth in the market, Djed is poised to become a staple in everyday transactions and fee payments on the Cardano platform.

It’s exciting to see the advancements being made in the stablecoin market and how they are helping to drive mass adoption of cryptocurrency. The future of finance is rapidly evolving, and with innovations like Djed, it’s becoming clearer that decentralized, transparent, and secure transactions are the way forward.

Polygon (MATIC) Cryptocurrency: Understanding the Layer 2 Scaling Solution for Ethereum

Polygon, formerly known as Matic Network, is a layer 2 scaling solution for Ethereum. It is built on top of the Ethereum blockchain and is fully compatible with the Ethereum ecosystem, including smart contracts and decentralized apps (dApps). The main goal of Polygon is to provide a faster and cheaper alternative to the main Ethereum network, by using a system of sidechains.

One of the key features of Polygon is its use of a system of sidechains. A sidechain is a separate blockchain that is connected to the main blockchain (in this case, Ethereum) through a process called “pegging.” This allows for faster and cheaper transactions on the sidechain, while still maintaining the security and immutability of the main blockchain.

Polygon uses a consensus mechanism called “Plasma Cash” which allows for fast and efficient consensus on the network. Plasma Cash is a variation of the Plasma protocol, which is a scaling solution for Ethereum. It works by creating child chains (sidechains) that are connected to the main Ethereum chain. These child chains can process transactions faster and at a lower cost than the main chain, while still maintaining the security and immutability of the main chain.

Another important aspect of Polygon is its governance system, where token holders can vote on proposals to upgrade the protocol. This helps to ensure that the protocol stays aligned with the community’s interests and is continuously improving.

Polygon has partnerships with leading companies in traditional industries such as Samsung and ChainGuardian, and collaborations with leading research institutions such as Cornell University. These partnerships and collaborations demonstrate the potential of Polygon and the recognition it receives.

Polygon is also a Proof of Stake (PoS) blockchain, which means that users can earn rewards for holding and staking MATIC tokens. This is a more energy-efficient and environmentally friendly alternative to Proof of Work (PoW), which is the consensus mechanism used by the main Ethereum network.

Polygon has a wide range of use cases, including decentralized finance (DeFi), gaming, and non-fungible tokens (NFTs). Decentralized finance (DeFi) is a new financial system built on the blockchain, where users can access financial services such as lending, borrowing, and trading without the need for intermediaries. Gaming and NFTs are also popular use cases for Polygon, as they require fast and cheap transactions.

In conclusion, Polygon is a promising scaling solution for Ethereum. It offers a faster and cheaper alternative to the main Ethereum network, while still maintaining the security and immutability of the main blockchain. Its use of sidechains and Plasma Cash consensus mechanism, partnerships and collaborations, PoS mechanism, governance system, and various use cases make it a project worth keeping an eye on as the Ethereum ecosystem continues to evolve and mature. Additionally, it’s fully decentralized and open-source and has a strong and active community of developers and users, which is a great sign of the potentials of the protocol.

The Ethereum Shanghai Update: What You Need to Know

The Ethereum network is one of the most popular and most widely used public blockchains in the world. It is used for everything from financial transactions to smart contracts and more. That’s why the upcoming Ethereum Shanghai Update has been so highly anticipated. In this blog post, we’ll take a look at what you need to know about the Ethereum Shanghai Update and why it’s so important.

What is the Ethereum Shanghai Update? The Ethereum Shanghai Update is an upcoming upgrade to the Ethereum network that is expected to be implemented in July 2021. This update is a hard fork of the Ethereum network, meaning that it will require a network-wide upgrade of all Ethereum nodes. The update will be the first of its kind since the Istanbul update in 2019. The Ethereum Shanghai Update is intended to improve the scalability and performance of the Ethereum network. It will do this by introducing new features, such as sharding, which will help reduce the amount of data that is stored on the blockchain. Additionally, the update will introduce a new consensus algorithm called Proof-of-Stake (PoS), which will help speed up transaction processing times and make the network more secure.

Why Is the Ethereum Shanghai Update Important? The Ethereum Shanghai Update is important for a variety of reasons. Firstly, it will help to improve the scalability and performance of the Ethereum network. This will help make the network more efficient and allow it to handle more users and transactions. Secondly, the update will introduce a new consensus algorithm that is more secure than the current one. This will help ensure that the network is more secure and resistant to attacks. Lastly, the update will introduce new features that will make the network more user-friendly and easier to use.

What Should You Do to Prepare for the Ethereum Shanghai Update? If you are a user of the Ethereum network, there are a few things that you should do to prepare for the Ethereum Shanghai Update. Firstly, you should make sure that you are using the latest version of the Ethereum software. This will ensure that you are using the most up-to-date version of the network and will help to ensure that you are ready for the update.

Secondly, you should make sure that you are aware of the changes that will be included in the update. You should pay attention to the official Ethereum blog and read up on all the details of the update. This will help you to understand the changes and be ready for when the update is implemented.

Finally, you should make sure that you are prepared to upgrade your Ethereum node. You should back up all of your data before the update is implemented and make sure that you know exactly how to upgrade your node once the update is live.

Conclusion The Ethereum Shanghai Update is an important upgrade to the Ethereum network that is expected to be implemented in July 2021. The update will help to improve the scalability and performance of the network, introduce a new consensus algorithm, and introduce new features to make the network more user-friendly. If you are a user of the Ethereum network, you should make sure that you are prepared for the update by using the latest version of the software, understanding the changes that will be included in the update, and being prepared to upgrade your node.

Getting Started with Ethereum: An Introduction to Blockchain Technology and Cryptocurrency

Welcome to our Ethereum lessons blog!

Our goal with this blog is to provide comprehensive and easy-to-understand information about Ethereum, blockchain technology, and cryptocurrency. Whether you are new to the world of Ethereum or you have been following it for some time, we hope to provide valuable insights and resources that will help you understand this innovative technology and its potential.

First, let’s start by answering the question, “What is Ethereum?”

Ethereum is a decentralized, open-source blockchain platform that enables the creation of smart contracts and decentralized applications (dApps). It was first proposed in 2013 by Vitalik Buterin, a Canadian programmer and researcher, and it was officially launched in 2015.

Unlike Bitcoin, which is primarily used as a digital currency, Ethereum is a platform that enables developers to build and deploy their own decentralized applications. These applications can be used for a wide range of purposes, such as online voting systems, supply chain management, and even digital collectibles.

Ethereum also has its own cryptocurrency called Ether (ETH), which is used to pay for transactions and computational services on the Ethereum network. It can also be bought, sold, and traded on cryptocurrency exchanges.

In the next post, we will dive deeper into how Ethereum works, including the concepts of smart contracts, dApps, and the Ethereum Virtual Machine (EVM). We will also discuss the benefits and potential use cases of Ethereum, as well as its current state and future outlook.

Stay tuned for more updates and thank you for joining us on this journey to learn about Ethereum!