Dai Maker is controlled by protocol and makerdao. It is connected to the US dollar, making its value stable compared to other cryptocurrency. Crypto assets are deposited in Maker Depot to mint Dai. It can avoid instability by investors and can be used in various financial services on Defi Platforms.
What is DAI?
DAI is an ethereum-primarily based stablecoin, which is developed and controlled by Maker Protocol and Makerdao (Decentralized Self Sustaining Group). Dai value The US is linked to dollars and is back from other cryptocurrency in a particular way, which is deposited in vaults via smart contracts.
Why Dai is unique
The biggest feature of DAI is that it is a solid cryptocurrency. That is, its value is linked to the US dollar, making its value much less fluctuating compared to other cryptocurrency. This can be a safe option for investors who are looking for a stable currency to avoid the instability of cryptocurrency.
How does Dai work?
To mint (release) DAI, anyone has to submit a crypto asset (eg eth, WBTC, or other) in the Maker Depot. Then that person can borrow DAI against that deposited cryptocurrency. It works under a particular system, where DAI is produced from the value of the deposited cryptocurrency.
How is DAI generated?
There is no mining process to mint Dai, as in bitcoin and ethereum. Instead, DAI is controlled by Maker Protocol. Any person who collects a crypto asset (such as Eth) can generate Dai instead. The person can borrow it until the value of cryptocurrency remains in the correct range.
Benefits of Dai
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Stable Value: The value of DAI is connected to the US dollar, making it a stable and relative currency. This helps to avoid the instability of the Crypto market.
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Dyscentralization: DAI is not controlled by any one company, rather it is controlled by Makerdao (a decentralized Automus Organization). This means that all transactions are in transparent ways and are not under control of one private organization.
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Security by smart contracts: All DAI transactions and mining processes are through smart contracts, which are based on Etreum Blockchain. Thus this system is very secure and transparent. If you want to know in detail about Ethereum Ethereum What is Read to
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freedom: To mint DAI does not require permission of any central bank or organization, so that users can use direct cryptocurrency without any mediator.
Difference between DAI and SAI
There was also an old version of DAI, called “Single-Collectral Dai” or SAI. In SAI, only one cryptocurrency (eth) was backing. Whereas, Multi-Collectraral Dai uses many types of cryptocurrency, such as Eth, WBTC, Uni, Link and others. Dai Financial Savings Price is also available in Multi-Collectraral Dai, so that users can earn interest by keeping their DAI, which was not in SAI.
Future of dai
Dai has high expectations as a cryptocurrency, as its price is stable and can be used in many areas. Efforts are going on to make Dai more advanced and develop its ecosystem through Makerdao. Also, DAI is being used in many platforms and Defi (Decentralized Finance) projects at this time, which makes its future more bright.
DAI supply and security
There is no maximum supply of DAI, that is, its production and supply is according to the demand of the market. DAI is protected by Ethereum’s Eethesh Set of Rules, which provides protection of Ethereum Community.
Where can Dai be used?
Dai is used by many users. It is used in borrowings, loans and other financial services on Defi Platforms (such as Makerdao, Compound, Aave etc.). In addition, it is considered a safe and effective option to provide stability compared to other cryptocurrency.
DAI users keep it as stable currency and include them in their portfolio to avoid any kind of instability. It can be used for various types of smart contracts on Ethereum Community.
Conclusion
Dai is a very important and useful cryptocurrency, providing stability in the market. Its features such as its stability, decentralization and transparency make it different from other cryptocurrency. If you have interest in cryptocurrency investment, DAI may have a stable and secure option in your portfolio.
