With this partnership, Cosmos is ready to embrace a new stablecoin, supported by Umee's innovative technology.

This week, cross-chain protocol Umee Umee's agreement with MakerDAO aims to integrate the decentralized stablecoin DAI into the Cosmos ecosystem, addressing the significant void left by the failure of the algorithmic stablecoin TerraUSD (UST). last month’s historic meltdown . 

Brent Xu, the CEO of Umee, highlighted in an article earlier this week that the UST collapse underscored the urgent need for a reliable and secure stablecoin within the Cosmos ecosystem. He also mentioned that Umee's future goals include developing cross-chain stablecoins and incorporating Cosmos assets into MakerDAO. Decrypt The Cosmos network is characterized as a rapidly growing community of self-sustaining, interconnected blockchains, all built using user-friendly application components and linked through the innovative Inter-Blockchain Communication (IBC) protocol. Currently, the platform supports

Cosmos over 265 applications, wallets, blockchains, and explorers, featuring major projects like hosts The vision states: \"We advocate for interoperability and the concept of autonomy rather than silos and monopolies, preferring collaboration and innovation over rigid competition and the status quo. We believe that value created by many should be accessible to all, allowing for secure exchanges, storage, and protection of this value without dependence on centralized systems.\" Binance chain, Crypto.org, and Terra.

The company’s intro The recent dramatic fall of Terra's UST stablecoin has gained significant attention.

In a guide released as UST began to lose its stability, CoinDesk noted that UST's market cap skyrocketed from $180 million at the start of 2021 to nearly $15 billion by March 2022, while the value of LUNA surged an astonishing 138 times. According to them, \"Algorithmic stablecoins represent a relatively modern approach to pegging cryptocurrencies to fiat currencies. Given their novelty, they have yet to withstand the test of time, particularly during periods of significant market upheaval or volatility.\"

While UST utilized a unique \"mint/burn\" strategy, the over-collateralized nature of DAI has proven to offer enhanced security. Currently, MakerDAO's stablecoin enjoys a market cap of approximately $6.9 billion. As detailed by Decrypt, to mint $1 of DAI, one must deposit as much as $1.75 worth of Ethereum. Additionally, a range of other cryptocurrencies can serve as eligible collateral, such as

(WBTC), Uniswap (UNI), Polygon (MATIC), amongst others. Wrapped Bitcoin Decrypt further elaborated, \"Each collateral type comes with its own required 'minimum collateral ratio' that determines how much of that asset is necessary to mint DAI.\" Notably, the data dashboard reveals that Circle's stablecoin is currently the most frequently used collateral for minting DAI.

This situation raises valid concerns about the true decentralization of DAI. DAI Stats Discussions surrounding stablecoins have sparked a range of meaningful debates about our collective understanding of value. Rather than simply being seen as physical currency, stablecoins resemble a framework for measurement—similar to how we use meters or feet for length. It's intriguing how DAI is often compared to USD as a financial benchmark, subtly indicating an underlying agreement on a shared standard. Imagine a scenario where you could propose your own criteria for measurements, and a substantial number of individuals would actually consider it. USDC Reflecting on what truly underpins value in blockchain and financial markets naturally prompts one to question the tangible nature of currency itself.

Cryptocurrency and DeFi Thus far, Cosmos's mission to create an open space for blockchain projects to develop on their own has revealed the classic advantages and challenges of freedom. The fine print on their ecosystem's app listing states, \"We haven't officially vetted or contacted these projects for verification. Please conduct your own research before using any service within this open network.\" The most fragile aspect of freedom is:

"Unlike other protocols that rely on bridges to create wrapped assets—essentially, a version of a blockchain's native currency equivalent to a non-native asset—Umee offers a different method,\" Xu explained to Decrypt regarding Umee's approach, which links Cosmos and EVM-compatible blockchains. \"Our model allows users to lend and collateralize without introducing any wrapped assets, thereby enabling participation in various ecosystems.\" Umee may harness the potential to aid in healing, contingent upon DAI fulfilling its role.

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