An Overview on DAI Coin
DAI coin is a stable coin. That is, DAI aims to remove the effects of volatility of cryptocurrencies like Bitcoin and Ether. So, you can use DAI coin regularly for purchases and transfers without worrying about the state of the crypto market.
DAI stablecoin is collateral backed cryptocurrency. Anyone can generate DAI coin by putting cryptocurrencies as collateral.
The collateral system works on Maker smart contract platform which is built on Ethereum. And the DAI price is always relative to the US dollar. So, DAI prediction is something you do not have to bother about.
Collateral Debt Positions (CDPs)
By putting collateral in the smart contract, you can generate DAI stablecoin. And by that, you will hold a Collateral Debt Position (CDP).
Your CDP will be dissolved when you payback the DAI coin along with a stability fee. After only dissolving the CDP, you can withdraw your collateral.
The stability fee is added to your debt over time. You can only use MKR coin—the cryptocurrency of the Maker platform—to pay the stability fee.
Right now, you can only use Ether (ETH) as collateral. First, you should put your Ether in a smart contract. Then the smart contract will give you Pooled Ether (PETH). And you can use the PETH for making the CDP.
Nevertheless, the range of cryptocurrencies you can use as collateral will increase in future. For the moment, it is just Ether.
DAI Coin Wallet
Both the DAI coin and MKR token are ERC20 compliant. So, you can utilize any wallet that supports ERC20 tokens.
Some of the ERC20 wallets are:
According to CoinMarketCap data, DAI price has stayed very close to one US dollar for the past month. And it is interesting to see whether DAI coin price would hold the same in the future, similar to USDT.
Would you opt for DAI ico and pay the stability fee? Let us know in the comments below.