The first regulated fiat-backed stablecoin in the Cardano ecosystem is expected to be launched in 2023. Emurgo, one of the developers of the cryptocurrency, announced the launch of the project in 2018. IOG, the company behind the Cardano blockchain, announced the launch of a new blockchain called Midnight. It will be accompanied by a token called dust.
According to Charleson Hoskinson, the CEO of IOG, Midnight is built on a zero-knowledge-proof technology, making it one of the first blockchain projects to deliver smart contracts that are completely secure.
Cardano based stablecoin USDA to be released in 2023
According to him, the system will allow regulators and auditors to gain a backdoor into the system through authorization.
The stablecoin of Cardano will be pegged to the US Dollar. This will allow it to maintain a stable exchange rate. During the liquidity crisis and the collapse of the FTX exchange, the deprecation of USDT and USDD caused a concern for regulators around the world.
The launch of the stablecoin of Cardano is expected to address the various concerns surrounding the deprecation and transparency of USDT and USDC. Due to the lack of transparency regarding the collateral and reserves of USDT, the launch of a fully compliant and regulated stablecoin is likely to gain widespread support.
The launch of the stablecoin of Cardano will allow users to easily convert their fiat money into USDA. They can do so through various methods, such as wire transfer, credit cards, and conversion of ADA.
In addition to the aforementioned methods, Emurgo also revealed that it plans to allow the conversion of other stablecoins, such as USDT and USDC, into USDA following the launch of the regulated stablecoin. Emurgo partnered with a US-based financial services firm to ensure that the stablecoin was in compliance with the regulations.
Cardano: Impact of recent developments
In an interview with CoinDesk, Charleson noted that the technology behind Midnight has evolved from the previous generation of privacy coins, such as Monero and Zcash. He said that the system now allows everyone to anonymously carry out transactions.
According to Charleson, the system will allow people to create and run private smart contracts. It will also allow them to perform various transactions anonymously.
Despite the widespread support for privacy coins, they have been viewed warily by some regulators due to their potential to facilitate financial crime. Charleson noted that privacy is a legal requirement in most businesses, and it is still not feasible to add it to blockchains due to the complexity of the technology.
According to Charleson, the key to making a privacy coin work is having the necessary programmability. He noted that one of the most important factors that needed to be considered was the ability to write it in a standard programming language.
Two years ago, IOG published a paper entitled “Kachina,” which explored the potential of privacy-enhanced smart contracts on the blockchain. According to Charleson, the paper has generated interest in the enterprise blockchain space. He noted that Midnight will be working with a group of large organizations, such as Hyperledger, which is exploring the use of permissioned and private ledgers for various applications.
In response to the paper, Charleson noted that the enterprise is eager to adopt the use of privacy-enhanced smart contracts on the blockchain. He noted that several large organizations, such as Walmart, are currently working with Hyperledger on the use of private ledgers.
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