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Dai (DAI) Research

Dai (DAI) Research Details

Dai (DAI) Dai


The first cryptocurrency to be split, backed by securities, DAI is a crypto asset that tries to maintain a stable 1: 1 value in US dollars by locking other crypto assets in contracts. This means that unlike other asset-backed cryptocurrencies, which may be issued by for-profit companies, DAI is a product of open source software called Maker Protocol, a program dedicated to running on the Ethereum blockchain.

Thus, the DAI retains its value, not with the support of U.S. dollars held by the company, but through a joint venture invested in ether (ETH), the cryptocurrency Ethereum.

The MakerDAO utility and governance token is MKR, which is used to stabilize the price of Dai crypto. Dai was created to simplify crypto borrowing, which is very much based on the Maker's protocol. But like the ERC20 token Dai crypto also offers a wide range of potential use cases in Ethereum, including the creation of smart contracts.


The origin of DAI begins with the creation of MakerDAO in 2014. That year, the Maker Foundation was founded by Rune Christensen, and the Maker Foundation developed the Maker Protocol, an open-source project aimed at implementing a credit system that would allow users to take loans using cryptocurrencies.

Since then, the project aims to create a DAO in order to maintain a stable currency within Ethereum. The idea was completely new, something like this had never been built, and its developers took enough time to design a clear proposal on how to do it without fail.


The main goal behind making Dai was to create a safe way to store value. As we know, currencies such as BTC and ETH, suffer from significant fluctuations in terms of the period of growth of the sector in which we find ourselves. This volatility is not a problem for economic systems that seek to generate profits through this feature. But in operating conditions such as forums, savings, or transfers, this volatility is ineffective and unnecessary.

Through collateral guarantee system, it is possible to produce DAI at a cost of 1: 1 compared to the dollar using highly volatile cryptocurrencies. In this way, the coins produced can be used to perform fixed and stable value operations on other platforms, with the assurance that the quoted coins are guaranteed by deposit. Therefore, whether the value of cryptocurrencies goes up or down, the value generated will remain the same, and in the worst-case scenario, there are guarantees to avoid value loss.


The creation and use of DAI crypto was often based on something called collateralized debt positions (CDPs) in an earlier version of MakerDAO. Now, you can generate DAI by opening the Maker collateral vault and installing Ethereum-based assets as collateral, similar to CDP. These securities are acting as escrow accounts, in effect, holding the collateral until the borrowed DAI is repaid.

The collateral you enter must always exceed the amount of DAI you issued. If the deposit amount falls below the value of the DAI tokens issued, your deposit will be terminated. This helps to keep Dai's value strong, as well as its peg in the US dollar.


However, DAI as a currency allows you to open doors in a variety of applications, and among them, we can highlight:

·       Financial independence for all: DAI is a stablecoin we can find anywhere in the world, by accessing its dApp. It does not depend on any commercial bank, central bank, or government. This means that anyone in the world can convert cryptocurrencies, thus accessing other financial services within DeFi.

·       Fast and low-cost remittances: Another major use is settlements, that is, payments between countries, which are often used by foreigners to send money to their relatives.

·       Bridging the DeFi world: Another use case is its ability to integrate DeFi land. DAI is a nationally distributed, reliable, and secure currency that has been with us for many years. This is where it works as a link between different protocols.


MakerDAO has made great progress in making Dai as competitive with as much money as possible. Since Dai was launched in 2017 on the Ethereum blockchain, one can safely say that the token has been a huge success.

In order to be successful in the future and achieve its goals of being accepted and used by millions of people, the Maker must work and focus on the token's branding, educating people about the token and the benefits they will have if they decide to use the token.

However, since Dai is different from other stablecoins in many ways, it seems that such a thing is impossible and that Dai's future seems bright.


Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions. Crypto products are currently unregulated and subject to market risk. Please seek independent financial advice or do your own research before investing.