Can Cardano-backed stablecoin partners leverage the crypto payment ecosystem?

As a well-known public chain project, Cardano has always had an “anxiety disorder” in terms of stablecoins. In this case, he chose to work with a professional payment solution, and Coti became well-known. So what exactly is Coti? What changes can it bring to the Cardano ecosystem? Are there any opportunities for us ordinary investors? Here’s how to answer for you.

Coti and Cardano communicate to launch stablecoin Djed, the project has a bad start, but the two sides continue to increase their weight

Founded in 2017, Coti is a payment solution based on DAG technology, with the goal of creating a payment system that is scalable, fast, private, inclusive and low-cost.

On the technical side, the COTI protocol is based on DAGs (Directed Acyclic Graphs), which enables scalability and instant settlement while maintaining security. It has a multi-address privacy module and employs a one-of-a-kind consensus algorithm called Proof of Trust (PoT), which is designed to encourage good network behavior, resulting in lower fees and improved quality of service.

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Cardano and Coti in-depth collaboration theme poster

On the business side, in addition to providing crypto payment solutions for various businesses, Coti also has a deep cooperation with Cardano. In February, Coti partnered with Cardano’s lead development company, Input Output, to launch a stablecoin called Djed. Djed is an overcollateralized algorithmic stablecoin, backed by Cardano’s native token ADA, with a collateralization ratio of up to 400%-800%, and has been integrated into 40 applications in the Cardano ecosystem.

Under the influence of the overall market environment, the development of Cardano’s stablecoin project Djed has not achieved significant growth as expected. Djed’s stablecoin size hasn’t increased significantly since its launch, and the recent significant decline in staking reserves has led to a temporary halt to the minting of new Djed tokens, which has also sparked rumors in the community that Cardano may shut down the Djed project.

However, in the face of rumors about the possible termination of the Djed stablecoin, Cardano’s founder, Charles Hoskinson, was adamant that the project would not only continue to exist, but also undergo major upgrades. Hoskinson believes that the stablecoin and payments space is critical to the blockchain industry, and the Cardano ecosystem will firmly support the Djed project to continue innovating to gain a foothold in the massive stablecoin market.

Cardano also announced the appointment of W. Sean Ford is the company’s new CEO and David Markley is the new COO. W. Sean Ford’s extensive experience in the technology sector is highly noted, having previously been part of Algorand’s founding team and serving as Chief Operating Officer and Chief Executive Officer. In addition, David Markley joins IOG from senior roles in Algorand’s Operations, Venture Capital and Business Solutions teams.

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Djed stablecoin price chart

W. Sean Ford said that the stablecoin space is rapidly evolving as the next frontier for digital asset payments, settlements, and innovation. He expressed his excitement to work with the IOG team and the broader blockchain, stablecoin, and crypto communities to co-create and launch the next generation of stable assets. This series of personnel changes demonstrates Cardano’s confidence in the future of stablecoins and payments, and is committed to continuing to drive innovation and development in the space.

Based on a fully decentralized underlying protocol, Coti aims to solve the core pain points of Web3 finance

The field of financial payment has been solving the problems of low efficiency, high cost and insufficient security of traditional financial payment systems. As an emerging technology, blockchain technology has the advantages of decentralization, high security, and traceability, so it is considered to be able to effectively solve these problems and bring broad application prospects to the field of financial payment.

The Coti team strongly believes that for cryptocurrencies to have a significant impact in the online payment space, they must be user-friendly, convenient, and highly scalable. While there have been several blockchain-based technologies that have attempted to provide high transaction throughput and keep costs low, they have had limited success.

To address these challenges, Coti employs an innovative underlying protocol that employs a block structure in the form of a Directed Acyclic Graph (DAG). The protocol is built on a trust-based algorithm (Trust Chain) and is fully decentralized.

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Introduction to the TrustChain algorithm

In this protocol, there is a decentralized data structure called a “Cluster” that records all the transactions that occur in the network. Clusters are not controlled by any central authority, but are maintained by all participants in the network. Each new transaction requires the selection of two previous source transactions for validation, a mechanism that helps ensure the security and reliability of the network.

The operation of the Coti network is inextricably linked to the trust score. The calculation of the trust score is done by the trust score node, and this process involves many aspects. First, the node calculates the trust score through a questionnaire and KYC (Know Your Customer) documents submitted by the user. This means that users need to provide relevant information to build their trust.

In addition, nodes consider a number of factors, including the valuation of the transaction, the number of disputes against them, the number of disputes in favor of the counterparty, and the rating of other users on that user. This comprehensive assessment will eventually result in a new trust score for users, with users with high trust scores enjoying relatively low transaction fees.

In the Coti network, any new transaction must be verified, which is based on a reference to the two previous transactions. The first two transactions you choose to verify should have a trust score similar to your own. Once verified, the transaction is added to the Cluster and a chain of trust is formed.

It is worth mentioning that users with high trust scores will benefit from lower transaction fees, and the entire transaction confirmation process is supervised by the chain of trust consensus algorithm. This means that the time it takes for a transaction to be confirmed will also depend on the trust score, with users with a high trust score enjoying faster transaction confirmations, while users with a low trust score may need to wait longer for the transaction to complete.

In terms of speed, transactions on the Coti network are even faster than traditional payment systems such as Visa. In contrast, blockchain-based cryptocurrencies typically only handle a limited number of transactions per second, for example, Bitcoin can process 7 transactions per second, Litecoin can process 56 transactions per second, and Bitcoin Cash can process 300 transactions per second. This gives Coti a distinct advantage in handling high-frequency payments and real-time transactions.

In summary, Coti has multiple advantages:

1. Efficient performance: The Coti network is able to process multiple transactions in parallel, providing faster transaction confirmation time.

2. Trust Scoring System: Each user is assigned a trust score based on historical behavior, and users with high ratings enjoy faster transaction confirmation.

3. Dispute resolution mechanism: Coti provides arbitration services to help resolve transaction disputes and increase the security of users.

4. Low fees: Due to its decentralized nature, Coti is able to offer low transaction fees.

5. Adaptability: Coti is not only suitable for everyday transactions, but also provides convenient payment methods for merchants and consumers, while also supporting other uses, such as stablecoin issuance and enterprise solutions.

6. Security: The Coti network has multiple security mechanisms, including double expenditure prevention nodes, to ensure that the security of the network is maintained. These features make Coti a payment network with potential, bringing innovation and viability to the payments and stablecoin space in the crypto world.

Private payment networks are recognized, Coti’s crypto payment solution is worth looking forward to

The Coti team has announced that they are about to launch their first private payment network in the coming weeks, and the network is now in its final testing phase.

Coti has signed contracts with game developers in various regions such as Asia and the UK to provide them with tailor-made payment solutions. According to the team, the main advantage of the private payment network solution is that it provides businesses with low-cost transactions, instant settlement, and the ability to customize and scale based on operational needs.

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Business plan landscape for Coti’s payment solutions

The core idea of this solution is to tailor a private payment network for the customer and fully integrate it into the customer’s platform. This way, customers can receive cryptocurrency deposits from multiple links, providing them and their users with an instant settlement, inclusivity, and a cost-reducing payment experience. In addition, customers have the ability to mint, issue, and trade new stablecoins pegged to various fiat currencies.

Users will be incentivized to use the network and trade with the new stablecoin, as this will not only provide themselves with a more convenient way to pay, but will also be able to save partners significant operational costs. These transactions will be processed through Coti’s infrastructure, enabling the benefits of scale, high performance, cost-effectiveness, and data management.

The launch of this private payment network marks Coti’s continued innovation and efforts in the payment space, providing businesses and users with more choice and a more convenient payment experience. The customizability and integration of private payment networks will be expected to bring real value to a variety of industries, paving the way for widespread adoption of crypto payments and stablecoins.

The beliefs of the Coti team deserve our attention and reflection. They strongly believe that the success of cryptocurrencies requires following more real-world rules and building products that meet real needs. Coti is working tirelessly to provide the right solutions for the cryptocurrency space to realize its potential.

Thanks to Coti’s efforts, we have seen continuous progress and innovation in the cryptocurrency space. The launch of private payment networks represents a response to real-world needs, which is expected to provide businesses and users with more choice and more convenient ways to pay.

In the future, we look forward to seeing the continued development of Coti and other similar projects in the crypto payment and stablecoin space, bringing more possibilities for digital payments. Developments in this area will continue to shape our payments future, providing us with more efficient, secure and flexible payment solutions. As such, Coti will continue to push the crypto space forward as a significant player, and it’s an area to keep an eye on and explore.