Cardano, a prominent player in the blockchain space, has made a significant breakthrough by launching its first fiat-backed stablecoin, USDM, developed by Mehen Finance. This milestone has solidified Cardano’s position in the $146 billion stablecoin market and provided users with a stable and reliable option.
Originally planned for an early 2023 release, the launch of USDM faced challenges due to complications with U.S. banking partners, including the closure of notable banks like Silicon Valley Bank, Silvergate, and Signature Bank. The situation became more complicated when Mehen’s initial banking ally, Cross River, decided to collaborate with Circle, resulting in further delays.
In a captivating CNF YouTube video, USDM is presented as a unique stablecoin among other Cardano-based stablecoins like DJED and iUSD. What sets USDM apart is its direct backing by the U.S. dollar, allowing users to seamlessly mint or redeem USDM using real dollars. This distinguishes USDM from the more complex algorithmic and synthetic-based stablecoins, positioning it as a more stable and reliable choice for Cardano enthusiasts.
A recent tweet by CardanoCommunity on March 17 announced that USDM, originated by Mehen Finance, enables users to mint or redeem USDM using the U.S. dollar. This feature sets USDM apart from other existing Cardano-based stablecoins, such as DJED and iUSD, which rely on algorithmic and synthetic models.
Mehen faced challenges on its journey to launching USDM. The white paper, released in November 2022, outlined the roadmap, but the year 2023 brought banking obstacles. After parting ways with Cross River, Mehen integrated services from fintech company Plaid in August 2023, ensuring smooth USD transactions for USDM.
In another supportive tweet by Cardano Yoda, the loyalty to USDM is emphasized, recognizing its status as the first USD-backed stablecoin in Cardano’s ecosystem and acknowledging the efforts of the Mehen team.
Mehen is now expanding its presence to the UK and Europe, seeking necessary licenses. Over 2,000 partners are planning to incorporate USDM on their platforms. The management and issuance of USDM will be regulated through smart contracts and decentralized oracles, ensuring transparency and security. Although USDM is entering a market dominated by giants like USDT and USDC, it holds a unique position within the Cardano network, as these major stablecoins are not operable on Cardano’s blockchain. The Cardano community has enthusiastically embraced USDM, seeing it as a significant advancement for decentralized finance on the platform.
In other news, recent CNF posts have highlighted that Cardano (ADA) has been fluctuating between $0.5319 and $0.7966 over the past month, yet to surpass the $1.00 mark. The crypto community had anticipated the altcoin’s price to surge past this threshold due to recent bullish trends. Currently, ADA is priced at $0.689, experiencing a 5.57% increase in the last 24 hours.
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