Cardano Spotlight: USDM Launch, Exchange listing, and SnekBot

Author

Utsav Sheth
March 15, 2024

Hi,

What's Spotlight? Every week, we highlight the most interesting events happening around Cardano. We want to help you cut the noise and find the signal.

We discuss all the different catalysts that can push Cardano Native tokens into the next bull run. Stablecoins, listings, and new tools that attract new users/apps. 

USDM

Mehen's USDM is slated to launch this week on March 16, 2024. This will be the first-ever fiat-backed stablecoin on Cardano! Let's look at Mehen and what USDM offers.

The Cardano DeFi ecosystem is going through a rough time, with DEX volumes dropping and the price action of CNTs experiencing downward momentum. A positive momentum here requires new users and inflows into the ecosystem. For that, we need interaction listings, interoperability, and reliable stablecoins.

Mehen is solving one of those problems with USDM, a 1:1 backed stablecoin. It would be backed with cash reserves in the bank, allowing it to grow seamlessly and provide price stability under all market conditions!

Mehen's road hasn't been straightforward due to hostility from US regulations. Under Operation Chokepoint 2.0, banks would deny crypto businesses from setting up bank accounts. This complicated their process and resulted in delays. But it's finally here!

USDM is one of the most unique fiat-backed stablecoins, allowing retail users to burn/mint the stablecoin! They have been approved in 17 US states to allow users to create an account and to burn/mint the stablecoin to maintain price stability. This would only be available to institutions at launch but will be launched for retail in the upcoming weeks.

USDM will be a Cardano Native Token, and it doesn't have any blacklist mechanism. This provides much higher ownership guarantees to users. For other stables like USDC/USDT, the issuing company can blacklist your coins and make them unavailable with the push of a button. This makes USDM one of its kind.

We are excited to see the USDM launch and bring the much-needed solution to Cardano DeFi.

Exchange listing

The previous section discussed how the Cardano ecosystem requires new inflows/users. Exchange listings have been a hotly contested topic in the past few weeks.

An exchange listing isn’t a straightforward task. An Exchange must integrate CNTs, maintain custody, and allow deposits/withdrawals. This is why an exchange wants to list a token that can either do high volumes organically, or the team pays them a listing fee.

As most CNTs do < $500K in daily volume, an exchange with 0.1% average fees would make <$500 per day. This isn’t as attractive for most exchanges; thus, they require a listing fee. Depending on the exchange size, the listing fees could vary from 10s of thousands of dollars to millions.

Teams on Cardano like Minswap, Mehen, Snek, Indy, Iag, and more are looking towards integrations/listings.  Recently, the Liqwid team announced that they had facilitated the launch of a Cardano Staking ETP on the Swiss exchange. This is a major step towards introducing a new inflow to Cardano DeFi. It's a positive flywheel; we get a few exchanges or listings, new users/inflows, and more listings. 

SnekBot

Snek and Dexhunter have collaborated to launch a TG bot. This integration will be a Telegram bot that helps users buy/sell coins with just a few clicks on the TG screen.

A user downloads the bot, creates a new trading wallet, and deposits money into this wallet. Now, transactions can be built based on user instructions. For example, if the user clicks to sell 1000 Hunt for 400 A, the bot places a limit order on one of the exchanges.

The bot will then construct the transaction and reach out to the users for their signature. Once this transaction is signed, it can be relayed to the validators/SPOs. Since it is relayed through Hunt nodes, they will have the ability to send transactions faster.

TG bots are a great source of revenue, providing a very clean & simple UI that can help onboard new users. Other bots, such as Unibot or BannaBot on Ethereum, have seen thousands of daily active users and millions in monthly revenue.

It will be exciting to see how SnekBot shapes up.

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