Mehen Finance, the entity behind Cardano's initial fiat-backed stablecoin, has now unveiled USDM. The process of onboarding institutional clients will kick off soon, marking the entry of USDM into the on-chain space in the upcoming week.

Previously, the absence of a robust fiat-backed stablecoin on Cardano was a point of contention among crypto analysts, who questioned the network's DeFi capabilities. Despite Cardano's multiple algorithmic stablecoins, founder Charles Hoskinson acknowledged the persistent demand for a fiat-backed stablecoin. In response to community demand, USDM was introduced to bolster DeFi activities on the network.

Initially, USDM will be available in 17 states and integrated into Cardano's largest DEX, MiniSwap, and Genius Yield platform. Users in these states can open accounts, complete the KYC process, and connect their accounts. Minting will initially be limited to institutional users, later expanding to retail users.

Mehen Finance has announced that deserving users can mint USDM without upfront fees but will incur a 1.5% burn fee, ranging from $50 to $5,000. Redeeming US dollars against USDM will also incur a 1.5% fee. Changes to the fee structure may occur based on additional features. While minting costs are covered by interest earned, redeeming carries a minimum fee of $50.

Originally scheduled for December 19, 2023, the USDM release was delayed for unspecified reasons. To mark the occasion, Mehen Finance minted 420.69 USDM initially. Mehen Finance's CTO, Steven Fisher, revealed that this project was part-time work for him. At the time of reporting, DJED had 3,212 holders, according to TapTools.

USDM is expected to enhance Cardano's DeFi ecosystem by offering a redeemable and regulatory-compliant asset accessible through major DEX platforms.