Dai (DAI) is a stable coin that determines its price by the US dollar’s value. DAI’s value regulates through MakerDAO, its decentralized governance community, for price stability. While actual DAI stable coins create its Maker Protocol platform, which takes a variety of cryptocurrencies as collateral, DAI can also be purchased directly on most regulated crypto exchanges using fiat money (such as the US dollar).
What is Dai?
DAI is an ERC-20 currency created with the Ethereum blockchain in mind. ERC stands for “Ethereum Request for Comment,” a standard for building and enabling smart contracts on the Ethereum network developed in 2015. Because of its relationship to the US dollar, one of the main advantages of DAI is that it offers the transactional benefits of a cryptocurrency with little volatility.
You can buy Dai through various cryptocurrency exchanges or decentralized exchanges (DEXs). You can also borrow DAI using the Maker Protocol by pledging Ethereum-based assets as collateral to guarantee the amount of DAI borrowed. DAI needs a bigger collateral deposit than DAI borrowed to ensure network liquidity. The collateral may forfeit if the value of your crypto-collateral falls below the value of the issued DAI tokens. However, if the value of your collateral rises, your DAI borrowing limit increases in proportion. The Maker Protocol works similarly to an escrow account, where the collateral is there until the loaned DAI and processing costs pays back.
If consumers wish to buy DAI, they can use ETH to acknowledge the equal dollar amount in DAI on an exchange or utilize the Maker Protocol to collateralize ETH and other assets.
Important Resources
DAI Coin Price Today
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Users who do not wish to sell their ETH can still buy DAI the latter way.
When the price of DAI falls below its mandated value of 1 USD, Maker DAO raises loan interest rates, incentivizing users to sell their Dai and pay off their loans. The supply is limited because the returned Dai is driving up the price. When DAI costs more than 1 USD, an entirely different system kicks in.
Maker DAO can change the Dai intelligent contracts as the protocol’s owners, such as controlling the types of approved collateral, collateralization ratios, and interest rates for borrowing or storing Dai.
How is this, however, still decentralized? Any changes you make to intelligent contracts are accessible to everyone on the blockchain. As a result, Dai embraces blockchain’s overall openness and trustworthiness.
Dai’s Price
Dai was introduced in December 2017, almost three years after MakerDao, the project’s governing decentralized autonomous organization (DAO) (see below).
Dai’s price is always around $1 because the cryptocurrency tethers to the US dollar. However, its price has changed away from that level on several occasions. It usually happens when the stable coin’s supply and demand fluctuate. Dai’s price tends to hover below $1 when the collection is high, but demand is low, and vice versa.
In September 2020, Dai reached an all-time high of $1.14, and in June 2022, it reached an all-time low of $0.8935.
Because Dai issues on demand by individuals who provide the proper collateral, there is no maximum supply. Users in debt can activate Dai’s burning mechanism by repaying the principal of their loan balance. However, interest payments made in dai will recirculate on the open market.
Users can only receive the stable coin if they submit the required collateral at the specified collateralization rate.
Dai is a cryptocurrency that exists on the Ethereum network. It lacks a native consensus method and any additional capabilities beyond those supplied by Ethereum.
Thanks to the asset’s reliability, users can utilize dai to lend, borrow, and invest in various apps, protocols, services, and products. Some exchanges have integrated dai as a primary trading option alongside other stable coins, making it a currency to trade against crypto assets.
When a user borrows against their locked collateral, dai creates- typically, 150 percent of the lent amount requires collateral upfront. The loaned amount repays within a particular time frame, or the collateral will be forfeited automatically. For example, if you wanted to make $1,000 worth of dai, you’d need to put down $1,500 in ether.
How to buy Dai?
Create an account
The most straightforward approach to buying Dai is registering an account with a crypto broker that accepts the coin. Dai offers various broker platforms, so you’ll be able to choose from several different brokers when you open an account. When selecting a broker, you may wish to examine the following factors:
— The trading platform used by each broker
– Commissions and fees
– There are more cryptocurrencies to buy and trade.
— Availability in your area
Purchase a wallet.
After you’ve decided on a broker, you’ll need to create a private wallet to keep your tokens. A cryptocurrency wallet gives you a unique set of keys that you may use to store your bitcoin investments on your preferred exchange. Cryptocurrency wallet divides into two categories:
Hardware wallets are USB-like device that allows you to keep your tokens offline. Unlike software wallets, hardware wallets are more expensive, but they give a higher level of security for your tickets.
Software wallets are desktop or mobile applications that allow you to keep track of your tokens and coins in a secure online wallet. Though software wallets aren’t as safe as hardware wallets (because they require internet access to access your investments), they offer investors a free method to keep their assets outside the exchange. Compared to hardware wallets, software wallets are usually open-source, which means they support a more comprehensive range of tokens.
Dai may store practically any Ethereum wallet that supports ERC-20 tokens. If you’re not sure where to start, check out our list of ERC-compliant wallets below.
Purchase what you want.
It’s time to make your buy after you’ve set up both your trading account and your wallet. Although the particular processes you’ll go through will vary depending on the broker, here are the fundamental steps you can expect to go through when buying DAI:
Step 1: Deposit into your brokerage account. Most brokers allow you to acquire cryptocurrencies with a direct bank transfer, but an increasing number of them accept credit and debit card payments. You’ll need to add a financing method to your brokerage account before you can buy or sell cryptocurrencies. Before proceeding, double-check that your correct funding method is linked and cleared.
Step 2: Decide what kind of order you’d like to place. Most brokers give you a variety of order types to choose from, ranging from fast-acting market orders to tightly restricted limit orders. Choose the ranking you wish to place and check out the current DAI pricing. In most circumstances, the cost will be nearly identical to $1.
Step 3: Complete and submit your order. Set a price and the number of DAI you want to buy, then place your order on your trading platform. You can now sit back and relax, knowing that your broker will complete your order according to the restrictions and parameters you specified.
Depending on current market circumstances, your broker may take anything from a few minutes to an hour to complete your order. Your tokens will appear in your exchange wallet when your broker completes the order. Your broker will either leave the order open indefinitely or close it after the trading day if they cannot fill it.
Where to buy Dai?
There are several ways to get DAI, and we’ll walk you through each one, explaining the benefits and drawbacks of each.
Centralized exchanges
You can purchase Dai on several standard cryptocurrency exchanges, much like most cryptocurrencies. Kraken, Coinbase, and Bitfinex are the most well-known exchanges list DAI. To buy DAI, you’ll need to put fiat money into your exchange account, just like any other cryptocurrency.
If they are not available in your area, several smaller regional exchanges list DAI, including:
- KuCoin
- Korbit
- Coinjar
- Panda
Custodial wallets
Custodial wallets are those in which the provider holds the cryptocurrency on behalf of their customers.
The distinction between buying on an exchange and buying from a wallet is technical. It is not readily apparent to the end-user: whereas sales support trading on their platforms, custodial wallets connect to businesses and other brokers when selling crypto to their users. As a result, purchasing through a wallet is generally more expensive than buying via an exchange.
Beginners will like custodial wallets since they relieve them of the obligation of storing their private keys. The provider holds the money for you. However, this implies that you don’t have complete control over your assets.
What is Dai worth?
The most significant advantage of DAI is its soft peg to the US dollar’s pricing.
Even the most significant, most liquid coins, like Bitcoin, are infamous for their volatility, with price fluctuations of 10% or more (both up and down) occurring multiple times in a single day. Traders and investors are naturally inclined to add safe-haven assets to their portfolios under these conditions since their constant price may assist in countering substantial market volatility.
Stablecoins, of which DAI is an example, is one type of asset. These are cryptocurrencies whose prices link to assets that have a relatively steady value, such as traditional fiat currencies like the US dollar or the euro.
Another significant benefit of DAI is that a decentralized autonomous organization governs it via a software protocol rather than a corporate firm. As a result, Ethereum-powered self-enforcing smart contracts manage and publicly record all token issuance and burning instances, making the entire system more transparent and less prone to corruption.
Furthermore, the development of DAI software is managed more democratically – through direct voting by frequent token ecosystem users.
How to mine Dai?
Unlike most cryptocurrencies, you cannot mine Dai.
Unlike Bitcoin, where once all 21 million bitcoin are there and in circulation, they are all there will ever be in the universe—the supply of Dai is neither predetermined nor rigidly constrained, which is one of the reasons the coin may remain stable.
Dai Market Cap
According to the most recent data available, the current price of Compound Dai is $0.022, and CDAI ranks in the entire crypto community. Compound Dai has a circulating supply of 0 and a market capitalization of $0.
The cryptocurrency’s current value has dropped by 0.27 percent in the last 24 hours. When we compare the present market capitalization of the CDAI to the previous day’s market capitalization, we can see that the market capitalization is likewise down.
Dai Price Prediction
Other cryptocurrencies are finding it challenging to accept Compound Dai. The CDAI has dropped to roughly -0.37% in the last seven days. The currency has been showing risky framing segments for the previous few days; while the coin has excellent fundamentals, we do not believe it will be a successful asset in the immediate run.
DAI coin is a decentralized tendency with no central authority. A smart contract that holds various digital assets (mainly in Ethereum (ETH)) keeps 1 DAI equal to 1 US dollar. When DAI coin’s price rises, the intelligent contract pricing mechanism tries to lower it, and vice versa.
In the previous 24 hours, Dai has been low. Dai has a market capitalization of 8.92 billion dollars. DAI volume is $345.49M in 24 hours. With a circulating supply of 8,920,278,859 and a maximum supply of 8,920,278,859, it is ranked 26 in market capitalization. Compound Finance ($71.81 million), Curve Finance ($55.28 million), and Uniswap V3 (Ethereum) ($54.26 million) are the top three exchanges for Dai. Over three years ago, Dai hit an all-time high of $1.1526. Dai has traded on 2,321 active markets in the previous day, with the top volume trading pairs being CDAI ($71.82 million), ETH ($41.08 million), and USDC ($35.27 million).
Dai’s value
MakerDAO’s DAI model is distinct from those of other popular stable coins. DAI, for starters, has a hitherto unheard-of level of decentralization. At the same time, stable coins such as Tether provide a cryptocurrency backed by a reserve of fiat assets maintained by a central institution, DAI, issued by no single company. Instead, people interested in holding DAI must deposit Ethereum-based assets into a smart contract that uses them as security to keep DAI tied to the US dollar.
Second, unlike other stable coins backed by cryptocurrency, various platforms support Dai. It includes ETH, BAT, USDC, wBTC, COMP, and others. At the time of the Near Protocol, only accepted ether as collateral. The technology modifies in November of 2019 to accommodate BAT and USDC, resulting in today’s multi-collateral DAI system. The increasing quantity of collateralizable currencies lowers user risk and improves the price stability of DAI. The MakerDAO community continues to introduce new collateral options by voting.
Third, holders of DAI tokens receive interest on their DAI. MakerDao’s native governance token, MKR, is used to establish the DAI Savings Rate and act as guarantors for DAI, which means their MKR tokens liquidate if the system crashes. This arrangement incentivizes guarantors to ensure the DAI system and its collateralized tokens run smoothly.
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