Dai (DAI) is a dollar-pegged cryptocurrency issued by the Maker platform. As part of the Maker protocol, any Ethereum-based assets can be used as collateral. Based on the deposited collateral, DAI stablecoins are minted, and if necessary, the user can exchange them back for their assets, then the stablecoins will be destroyed (burned). All actions are provided by smart contracts of the protocol, which, in turn, are managed by the community on a decentralized basis. This article will discuss the features of cryptocurrencies and how to exchange USD to DAI or other crypto pairs.
Cryptocurrency Features
The uniqueness of this token is that it is completely decentralized. Its release does not depend on the decision of a particular company. No one limits the emission, but an equivalent amount of ETH constantly backs it.
What is Dai in simple words? Dai is a decentralized and stable currency supported by Ethereum currencies frozen in a smart contract.
The token can be used for settlements or the transfer of funds. The unused part of the coins is burned. According to the developers, this leads to the stabilization of the exchange rate due to the continued balance of supply and demand.
A stablecoin can perform all the basic functions of money on the Internet:
- Medium of exchange in the sale, purchase, exchange, and commercial transactions.
- A store of value, a stablecoin is resistant to market fluctuations and hardly depreciates over time.
- A means of deferred payment – for example, in Maker Vaults, Dai is used to redeeming collateral and pay fees.
- Means of measure of value. This means that the price of any goods or services can be expressed in DAI, as in dollars or rubles.
- When creating a stablecoin, any digital asset on the Ethereum blockchain that users agree to use can serve as collateral for creating a stablecoin. MKR token holders approve accepted investments.
Where To Buy And Store Dai
DAI is one of the most widespread stablecoins nowadays. In this regard, it is supported by a large number of trading services:
- centralized crypto exchanges – almost all popular platforms, including Binance, OKX, Current.com, Bybit, Huobi, MEXC, EXMO, Bitget, Phemex, FTX, Kucoin, and others;
- decentralized exchanges include Balancer, Uniswap, Sushiswap, Curve Finance, 0x Protocol, and others;
- exchangers – it is convenient to use Matbea, Letsexchange, MChange, ExchangeKey, and others for trading USD to BLZ;
- p2p exchanges – although not all, some platforms support DAI, for example, Binance P2P, and Bitzlato.
- cryptocurrency can be stored in a decentralized wallet for ERC-20 tokens – Metamask; it is also present in Atomic Wallet, Exodus, and Jaxx wallets.
Conclusion
The DAI stablecoin is actively used in decentralized financial applications and is a convenient tool for this purpose. At the same time, the token’s potential is far from being exhausted: prospects are open in such areas as cross-border transfers, secured loans, risk hedging, prediction markets, and the online gaming industry. In addition, the list of assets that can be used as collateral to receive Dai will continue to expand.
