DjedPrice

(DJED)

Unlike undercollateralized algorithmic stablecoins, Djed is an overcollateralized stablecoin. It is backed by an external asset, ADA, with a reserve ratio maintained between 400% and 800%. This means there is significantly more value held in reserve than there is DJED in circulation. This high collateralization requirement ensures that the stablecoin remains backed by real assets even during periods of high market volatility, avoiding the risks associated with internal token backing.

Djed utilizes a reserve coin called SHEN to absorb market volatility. If the price of ADA drops, SHEN holders provide the equity necessary to maintain the $1 peg. The protocol includes a safety mechanism where it stops minting new DJED if the reserve ratio falls below 400%. This protects the peg by ensuring existing stablecoins remain fully backed, while SHEN holders act as the decentralized backup to maintain stability during downward price movements.

Djed is increasingly decentralized, with its core infrastructure—including the API, indexer, and frontend—moving toward an open-source model. This allows the community to build and maintain independent interfaces. Regarding security, the protocol was audited by Tweag and has a proven track record of operating on the mainnet for over two years without major exploits. The shift to open-sourcing key components in 2025 further reduces reliance on centralized entities and enhances transparency.

SHEN is the reserve coin that provides the collateral required to keep Djed stable. While DJED is designed to stay at $1, SHEN holders take on the price volatility of the underlying ADA. In return for providing this liquidity and acting as the protocol's safety net, SHEN holders earn rewards. These rewards include a share of the minting and burning fees collected by the protocol, as well as ADA staking rewards generated by the reserves.

The protocol charges a 1.5% fee for minting and burning DJED. To optimize costs, users may choose to acquire DJED through decentralized exchanges or platforms like LBank. For yield, SHEN holders earn protocol fees and staking rewards automatically. DJED holders can seek yield by participating in liquidity pools or utilizing lending protocols within the Cardano ecosystem to put their stable assets to work.

The 2025 roadmap introduces 'Private Djed,' a privacy-centric version using Garbled Circuits for confidential enterprise transactions. Additionally, the protocol aims to go multi-chain, making Djed available on other prominent blockchain networks via interoperability layers. There are also plans to explore diversifying the reserve pool by adding other collateral types, such as wrapped Bitcoin, to increase the total value locked and enhance overall protocol stability.