When was Dai issued? Learn about the origin of Dai in one article

DAI, a decentralized stablecoin launched in 2017 by MakerDAO, provides a stable alternative to fiat currencies with its value backed by a pool of collateral assets.

Oct 05, 2024 at 11:42 pm

1. Origins of Dai

The Dai currency project was launched in 2017 by MakerDAO, a decentralized autonomous organization (DAO) that manages the stablecoin DAI. DAI is a stablecoin that is pegged to the value of the US dollar.

2. The Purpose of Dai

DAI was created to provide a decentralized alternative to traditional fiat currencies. DAI is backed by a pool of collateral assets, such as Ether (ETH) and USDC. This pool of collateral ensures that the value of DAI is always stable, even during times of market volatility.

3. The Issuance of Dai
DAI is issued when a user deposits collateral assets into a MakerDAO vault. The value of the collateral must be greater than the amount of DAI issued. The user receives DAI in exchange for their collateral, which is held in the vault until the DAI is repaid.
Since it is an algorithmic stablecoin, DAI does not have a pre-defined issuance limit. The issuance and redemption of DAI are entirely governed by smart contracts on the Ethereum network. However, the amount of DAI in circulation is always backed by a corresponding amount of collateral, as determined by the stability fee and the collateralization ratio set by MakerDAO.

4. The Use of Dai
DAI can be used for a variety of purposes, including:

For Making Payments: DAI can be used to make payments for goods and services. It can be sent from one person to another anywhere in the world.
For Storing Value: DAI can be used as a store of value, similar to gold or other traditional currencies. DAI's value is stable, so it is not subject to the same price fluctuations as other cryptocurrencies.
For Earning Interest: DAI holders can earn interest on their funds by lending out their DAI on decentralized lending platforms like Compound and Aave.

Disclaimer:info@kdj.com

The information provided is not trading advice. kdj.com does not assume any responsibility for any investments made based on the information provided in this article. Cryptocurrencies are highly volatile and it is highly recommended that you invest with caution after thorough research！

If you believe that the content used on this website infringes your copyright, please contact us immediately (info@kdj.com) and we will delete it promptly.

Fear & Greed Index

Trade Now

Biggest Gainers

XOR

$0.00

35.69%

Trade Now
SNT

$0.0401

21.96%

Trade Now
NPC

$0.0148

21.28%

Trade Now
TIBBIR

$0.1285

20.21%

Trade Now
KTA

$1.04

18.85%

Trade Now
VADER

$0.0627

16.79%

Trade Now

Latest Crypto News

Ruvi AI: The Next Binance Coin with Low Entry?
2025-06-19 06:25:13
IP, Profits, Hype Fading: What's Next for Crypto?
2025-06-19 06:25:13
Shiba Inu Who? Ruvi AI's Audited Token is the Real MVP
2025-06-19 06:45:13
Litecoin's Hidden Setup: Is a 40% Rally Imminent?
2025-06-19 06:45:13
Cryptos, Arctic Pablo & Deflationary Strategy: The Meme Coin Revolution
2025-06-19 07:05:13
Cardano Price Prediction: Is Now the Time to Buy ADA?
2025-06-19 07:05:13

Related knowledge

What is the difference between decentralized stablecoins and centralized stablecoins? Pros and cons comparison

Jun 15,2025 at 09:42am

What Are Stablecoins and Why Do They Matter?Stablecoins are a category of cryptocurrencies designed to maintain a stable value, usually pegged to an external asset such as the U.S. dollar, gold, or even other fiat currencies. Their primary purpose is to reduce the volatility typically associated with cryptocurrencies like Bitcoin or Ethereum. This stabi...

What is the role of stablecoins in DeFi? Advantages and limitations analysis

Jun 14,2025 at 06:28am

Understanding Stablecoins in the DeFi EcosystemStablecoins play a pivotal role in the decentralized finance (DeFi) landscape by providing a bridge between volatile cryptocurrencies and traditional fiat currencies. Unlike Bitcoin or Ethereum, stablecoins are designed to maintain a consistent value, typically pegged to assets like the US Dollar or gold. T...

How do algorithmic stablecoins work? Potential risks and market impact

Jun 12,2025 at 02:07pm

Understanding Algorithmic StablecoinsAlgorithmic stablecoins are a type of cryptocurrency designed to maintain a stable value relative to a specific asset, usually the US dollar. Unlike traditional stablecoins like Tether (USDT) or USD Coin (USDC), which are backed by reserves such as cash or short-term bonds, algorithmic stablecoins rely on smart contr...

How do stablecoins anchor legal currencies? Technical and economic model analysis

Jun 16,2025 at 08:43am

Understanding the Concept of StablecoinsStablecoins are a category of cryptocurrencies designed to maintain a stable value relative to a specific asset, most commonly fiat currencies like the U.S. dollar or Euro. Unlike volatile cryptocurrencies such as Bitcoin and Ethereum, stablecoins aim to provide price stability by anchoring their value to an exter...

How do stablecoins maintain price stability? Principles and risk analysis

Jun 11,2025 at 12:01am

Understanding the Mechanisms Behind Stablecoin StabilityStablecoins are a category of cryptocurrencies designed to minimize price volatility, often pegging their value to a fiat currency such as the US dollar. The core principle behind stablecoins is to offer the benefits of blockchain technology—like fast and decentralized transactions—while maintainin...

What is the operating mechanism of stablecoins? In-depth exploration of its stability principle

Jun 10,2025 at 09:28pm

Understanding the Core Concept of StablecoinsStablecoins are a unique category within the cryptocurrency market, designed to address one of the most significant drawbacks of traditional cryptocurrencies: price volatility. Unlike Bitcoin or Ethereum, which can experience dramatic price swings in short periods, stablecoins aim to maintain a stable value r...