The Birth of DAI:
Creation and
Issuance
The Birth of DAI: Creation and Issuance MakerDAO was first introduced in
2015 by CEO and founder Rune Christensen, and the Maker Protocol -
the architecture underlying the DAI stablecoin - was launched in
December 2017.
While stablecoins like tether offer a
cryptocurrency backed by a reserve
of fiat assets managed by a central
organization, no one entity controls
the issuance of DAI.
Instead, users looking to hold DAI submit Ethereum-based assets into
a smart contract that uses them as collateral in maintaining DAI's peg
to the U.S.
MakerDAO's model for DAI differs
from other leading stablecoins.
First, DAI features an
unprecedented degree of
decentralization.
Third, DAI token holders earn interest on their DAI.
Those who hold MKR, MakerDao's
native governance token, set the DAI
Savings Rate and act as guarantors
for DAI - meaning, their MKR tokens
can be liquidated if the system were to
crash.
How DAI Tokens Work DAI is an ERC-20 token that can be
purchased from centralized and decentralized exchanges.
Advantage of Stability for DAI
Holders and Security Features
DAI is soft-pegged to the value of
the U.S.
Once borrowed, it can be used in decentralized finance
(DeFi) applications or blockchain-based games, among
other things. 
The increased price stability afforded by DAI
stablecoins has motivated investors to view DAI as a
stable store of long-term value and a viable option
for day-to-day transactional purposes, which has
dramatically expanded the utility of blockchain
technology and cryptocurrency systems as a whole.
DAI Stablecoin Advantages and Use-Cases No Account Minimum: Many individuals
worldwide lack the minimum quantity of assets needed to be eligible to open a bank
account, but there is no minimum balance amount required to use DAI.
Stable Value: DAI can provide an
alternative stable currency and means
of financial inclusion for citizens living
in locations with severe economic
instability.
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