Historical reference — The original USDJ/CDP system has been discontinued
This article describes the original USDJ/CDP system, which was shut down on November 17, 2025. The mechanisms and procedures described below are retained for historical reference and should not be treated as current operating instructions.
For updated fund-handling arrangements and exchange options, please refer to Updates on Handling of Funds Not Timely Returned Following USDJ System Shutdown.
USDJ enters the cryptocurrency ecosystem when it is minted by CDP owners who have locked up collateral to ensure the USDJ's value. CDP owners wishing to free their staked collateral must purchase USDJ on the open market and return it to their position. This destroys the USDJ. This minting and burning mechanism ensures that all circulating USDJ is backed by an abundance of collateral.
An autonomous system of smart contracts specifically designed to respond to market pressures work together to ensure that the essential stability property is maintained. No one can alter the core mechanics of USDJ, making it a safe and predictable form of money.
It's important to note that USDJ users do not need to understand the mechanics of the system in order to use USDJ; they can simply look at the historical record to determine whether they think USDJ will remain stable at close to $1.