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Biratnagar
4 Level
139 Review
-27.5 Karma

Review on Dai by Othere Obtentus

Revainrating 4 out of 5

Stablecoin

Dai is a cryptocurrency that is decentralized and stabilized against the US dollar value. It uses margin trading to adapt to evolving market dynamics and maintain its value against the major world currencies. Unlike other popular stablecoins whose valuation is directly supported by USD, it is supported by crypto collateral that can be publicly accessed on the Ethereum blockchain.
The value of DAI is maintained in place by a series of smart contracts that are automatically executed. To stabilize the price of DAI, when the price of DAI fluctuates too much from one dollar, Maker tokens are burned or created. The DAI price is automatically controlled by its algorithms, so no entity needs to be trusted to keep the currency stable. If the process performs as expected and one DAI is equivalent to one US dollar, MKR holders prosper when the overall supply of MKR reduces, making MKR more profitable.

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Pros
  • Easily transferable, transparent, and secure
  • Users maintain ownership over the private keys
  • Censorship Resistant
  • Does not require any account creation or KYC processes
Cons
  • Only listed on a few major exchanges and does not have nearly as many trading pairs

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