Cardano, a Layer-1 smart contract network that aims to provide security, scalability and sustainability to decentralized applications, has achieved a historic milestone with the launch of Mehen's USDM, a fiat-backed stablecoin.
The Mehen token (USDM) is a digital store of value token issued by Mehen Finance that is 1:1 convertible to U.S. dollars. USDM, as a Cardano-native token, can be transferred on the Cardano blockchain without the need for additional smart contracts.
In a tweet announcing the arrival of the USDM stablecoin on Cardano, Mehen stated that institutional customers will immediately begin the onboarding process, which might take one-two days. This means USDM will gradually arrive on-chain during the week of March 18.
As Cardano expands its ecosystem and attracts more users and developers, the launch of USDM is a watershed moment in the platform's march to widespread use.
The USDM token, remarkably, is the first of its kind on Cardano. Unlike the iUSD and DJED, Mehen's USDM is not algorithmic or synthetic but fully backed by U.S. dollars at 1:1. Users will put dollars (USD) into their Mehen account, which Mehen will store in a separate account for token holders. Once the transactions are completed, the user may mint the equivalent number of USDM cryptocurrency tokens.
The last quarter saw remarkable ecosystem expansion, with Cardano's stablecoin value jumping 37% QoQ and 673% YoY. With the debut of Mehen's USDM stablecoin, there are high prospects for growth in the Cardano stablecoin market.
ADA price action
At the time of writing, ADA was down 9.54% in the last 24 hours to $0.66, mirroring the broader market declines.
According to crypto analyst Ali, Cardano's price action so far resembles the pattern observed from 2018 to 2021. Ali said that if this fractal persists, ADA may consolidate in the $0.55 to $0.80 range in the following weeks, followed by a rise to $1.70. Following this increase, a period of consolidation may be expected, paving the way for a breakthrough to $5.