Interested in the DAI coin? If so, click here to learn more about the Dai cryptocurrency – from what it is to its current price on the market.
Thanks to the surprising success of Bitcoin, numerous other cryptocurrencies have popped up over the years, giving investors plenty of options to choose from.
With that said, given the number of available cryptocurrencies these days, what makes the DAI cryptocurrency stand apart from the rest? However, the more pressing question is, how much is the DAI stock price these days?
Learn more about the DAI coin by reading below.
DAI is a decentralized cryptocurrency with a steady value, also known as a “stablecoin,” and it was developed using Ethereum’s blockchain technology. Its creation and issuance are handled by MakerDAO and the Maker Protocol.
As a stablecoin, this cryptocurrency is soft-pegged to the US dollar, which means it strives to keep its value as close to a single US dollar. Simply put, the DAI to USD ratio is approximately one to one.
It does so by using Ethereum’s blockchain to maintain an automated system of smart contracts. These allow users to lend and borrow cryptocurrency assets without needing an intermediary while still guaranteeing minimal restrictions and utmost transparency
DAI coins are created when users take out a loan on the MakerDAO, and the coins simply function as stable Ethereum tokens.
Unlike other cryptocurrencies, the DAI stablecoin wasn’t developed by one specific individual or a group of people; it was created by the MakerDAO, a decentralized autonomous organization, using the Maker Protocol in 2015 and has continued to do so since then.
However, you should note that the MakerDAO itself was developed by its CEO, Rune Christensen. Still, the organization is managed by MKR (Maker) governance token holders.
These individuals have the power to make critical decisions regarding the DAI coin, such as its development and issuance. MKR holders’ voting power depends on how many MKR tokens they own.
Cryptocurrencies with steady values aren’t really new, but the DAI cryptocurrency has several characteristics that make it unique.
The DAI stock price is designed to stay as close to the value of one US dollar as possible, and it does this through the use of smart contracts.
These contracts automatically execute themselves to stabilize the crypto’s value, burning or creating additional MKR tokens whenever the DAI’s value deviates too far from one US dollar.
Moreover, since these are automatic, users don’t have to rely on a single person to manage the system and stabilize the price.
Lastly, MKR holders benefit from this system because the supply of MKR tokens will decrease once one DAI is equal to a US dollar, making their own supplies more valuable and rarer.
DAI is an ERC20 token, so everyone can use this stablecoin as a building block for any decentralized application that requires a stable payment system. They can do this without having to gain permission from anyone.
Moreover, interested developers can also modify the cryptocurrency to fit different uses, like the rDAI and xDAI.
New DAI tokens are created through the Maker Protocol whenever someone takes a loan with the MakerDAO. In turn, DAI coins are destroyed once the loans are paid back, ensuring the stability of their value.
Because of this, the total number of DAI coins can increase or decrease, depending on what’s needed to keep its value stable. However, as of November 2021, there are currently 6.48 billion DAI tokens in circulation.
As a stablecoin, it strives to maintain its value at precisely one US dollar. As of November 2021, one DAI token is approximately equal to one US dollar (1 USD).