Cardano founder Charles Hoskinson recently hinted that there was a lot of DeFi development happening at IOHK. One of the big reveals was a partnership through IOHK, Emurgo and Ergo will launch an algorithmic stablecoin. With true Charles swagger, he immediately stated it would be significantly better than Maker DAO.
So what is the big deal?
The DeFi sector is going through a massive boom, with over $8 billion locked into various protocols on Ethereum. Cardano has been relatively silent on what they want to do in this space. Hoskinson confirmed that more announcements will come later, perhaps around yield farming. That this new stablecoin is just one of the many DeFi products being explored. This has excited the massive ADA community to quickly get behind Ergo.
Zoom in: A new oracle solution to power DeFi products is already live on Ergo’s blockchain. And it will be fully compatible with Cardano’s Goguen release. This is a new approach to data oracles using pools. Fundamentally, different from Chainlink, with no native token required as a means of payment. Essentially, financial barriers are lower for teams to use oracles on Cardano compared to Ethereum.
- Even though ERG is tricky to buy without a mainstream exchange listing, that did not stop ADA whales moving in. ERG is now up by over 200% in the last 30 days, the token is listed on ViteX.
Zoom out: During the following month, ERG will integrate with the Yoroi wallet. Notably, it will be the first non-ADA asset in the the wallet.
As a result, ERG will then be accessible by the whole Cardano community and will receive a lot of attention. I am expecting the buying pressure on this coin to be massive. To the point that its current $26M market cap will more than triple.