What is the issuance and circulation of Dai?

Dai, a decentralized stablecoin backed by Ethereum collateral, is issued by MakerDAO and used as a medium of exchange, store of value, and in DeFi applications.

Oct 05, 2024 at 08:54 pm

1. Issuance of Dai

Dai is a decentralized stablecoin issued by MakerDAO, a decentralized autonomous organization (DAO). It is backed by a collateral of Ethereum (ETH), which is deposited into smart contracts. When users deposit ETH, they receive Dai in return. The amount of Dai issued is determined by the collateral ratio, which is the value of the ETH collateral divided by the value of the Dai issued.

2. Circulation of Dai

Dai is a cryptocurrency that can be transferred, traded, and used like other cryptocurrencies. It is used as a medium of exchange, a store of value, and a unit of account. Dai is also used in decentralized finance (DeFi) applications, such as lending and borrowing platforms.

The circulation of Dai is growing steadily. As of January 2023, there are over 6 billion Dai in circulation. Dai is traded on a number of cryptocurrency exchanges, including Coinbase, Binance, and Kraken.

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