This DAI review has revealed that Dai, or DAI, is a stablecoin that aims to keep its value close to that of the United States Dollar by making use of smart contracts on the Ethereum blockchain.
🏆 Top 3 Brokers Crypto Trading Platforms
Best Crytpo Trading Platform
Choose your quick section of our DAI review below.
A Quick Overview of our DAI Review:
MakerDAO, a decentralised autonomous organisation (DAO), maintains and regulates DAI alongside its own governance token, MKR, allowing users to vote on changes to certain parameters on smart contracts.
DAI Live Price
What is DAI?
Dai, or DAI, is a stablecoin that aims to keep its value close to that of the United States Dollar by making use of smart contracts on the Ethereum blockchain. MakerDAO, a decentralised autonomous organisation (DAO), maintains and regulates DAI alongside its own governance token, MKR, allowing users to vote on changes to certain parameters on smart contracts.
Key Features and Takeaways of DAI
DAI stablecoin is a cryptocurrency that is backed by the collateral, and to further understand it and the role that it plays in the cryptocurrency space, it essential to consider its features and takeaways.
Using MakerDAO to obtain DAI
MakerDAO is an open-source project that was founded in 2015 and is built on the Ethereum blockchain as well as a decentralised autonomous organisation (DAO). To interact, or create DAI on the Maker platform, users must leverage the Ethereum in smart contracts on the Maker system.
These are also known as collateralised debt positions (CDPs), with Pooled Ether (PETH) as the only collateral type which is accepted on the platform. To obtain DAI from a CDP, users must convert their Ether to PETH. This can be done by following these steps:
Create and collateralise a vault.
Generate DAI from the collateralised vault.
Pay down the debt as well as stability fee and withdraw collateral.
Specific and unique features of DAI
DAI helps to even out the risks involved in various gambling markets.
DAI is a price stable collateral that offers permissionless decentralised trading leverage as result of Maker’s collateralised debt.
DAI eliminates costly international transaction fees and intermediaries in addition to allowing foreign exchange volatility which can be mitigated.
DAI undertakes transactions that are completely verifiable, allowing different organisations, corporations, governments, and other entities to increase their efficiency and subsequently lower the chances for corruption.
DAI Mining
MakerDAO, a decentralised autonomous organisation (DAO) has a governance token, MKR, as well as a stablecoin, DAI, which is used, and which is pegged against the US Dollar’s value. Neither MKR nor DAI can be mined, as result of both being ERC20 tokens. Holders of DAI and MKR are provided with voting rights to collateralisation on the platform.
Governments have a stake in the protocol and participants in the platform are incentivised to vote on changes which could benefit the overall Maker ecosystem. Collateralised debt position (CDP) makes it possible to provide liquidity when there is interaction with cryptocurrency assets.
The idea is to offer investors and traders with a decentralised platform which is suitable for margin trading at lower costs when compared to other platforms. Investors can use MKR when they believe ETH is undervalued. While they participate in the rise of MKR, they can make ETH deposits with MKR, obtain a CDP, and get DAI in return.
Through this, traders and investors can make other ETH trades using DAI and when the ETH they hold is leveraged, it is subsequently locked-up to get more ETH and earn more profits from the increase in price.
Pros and Cons
| ✔️Pros | ❌Cons |
|---|---|
| Backed by the US Dollar, which means that DAI remains stable if the value of USD remains stable | DAI cannot be mined |
| Offering of collateralised loans | There is a lot of competition amongst various stablecoins |
| Smart contracts are used to lock cryptocurrency assets in contracts | |
| The supply of DAI cannot be altered by any party in the network, which offers complete transparency and security | |
| Both MKR and DAI offer flexibility | |
| There are transparent auditing frameworks involved | |
| DAI makes international trade easier and more cost-effective | |
Transaction Fees
| 💰 Type of Fee | ℹ️ Information |
|---|---|
| Trading Fees | 0.1% to 0.75% |
| Withdrawal Fees | 1.0 DAI to 26 DAI |
Should you buy DAI?
DAI was built on the reputation of the most popular and successful currency in the world, the United States Dollar. The idea behind DAI, or any other stablecoin, is that each coin is worth one US Dollar. DAI is designed to ensure that there is liquidity through a link to widely-used currencies.
MakerDAO allows for DAI to be obtained through CDPs, which is a contract to buy a certain amount of USD. These are credit swaps that are carried out by Makers and they are paid in DAI for their services, this works to ensure that the price of DAI remains as close to the US Dollar as possible.
This is done by making use of a system of smart contracts which execute themselves automatically. When DAI fluctuates too far from one US Dollar, Maker tokens are burned or created so that DAI’s price is stabilised.
DAI is automatically managed by MakerDAO’s algorithms and the price has remained stable for more than three years, which offers investors with some stability in that the price will not rise or fall without warning or cause.
Another reason why DAI is considered worthy of investment, is that it is an ideal cryptocurrency asset to spend. DAI can be spent in a variety of ways as there are numerous merchants and companies that accept payments in cryptocurrencies.
In addition, during the past few years, decentralised finance (DeFi) has seen DAI, along with other cryptocurrencies, emerge as popular assets in the ever-expanding DeFi ecosystem.
How to buy DAI (DAI)
Step 1 – Register an account with Gate.io
Navigate to the official Gate.io website and select the option to “Sign Up” from the homepage.
Complete the online registration form by providing country/region, a selected username, email address, and user-selected password. Read and accept the User Agreement and Privacy and select “Next”.
Create a fund password and select “Create Account”. Complete the “I am not a robot” reCAPTCHA. Check your email inbox for the activation email and click on the link in the email. If the link does not work, you can copy and paste the URL into your browser.
Log into your account using your credentials and complete the reCAPTCHA.
Check your email again for the verification email that contains the 6-digit code and click on “Confirm”. Enter the code that you received into the blocks provided and select “Log In” to proceed.
Before you can use the platform to purchase DAI/DAI and other cryptocurrencies on Gate.io, you must complete the “Know Your Client” or KYC procedure to verify your identity and your proof of residence.
Click on “KYC Now” at the bottom of the webpage to start the process.
Select whether you are an individual or an organisation by selecting “Verify Now” under the relevant option.
Select your country from the dropdown list, enter your full name followed by confirmation thereof. Select your ID document type and provide your ID Number as shown on your official ID Document.
Click on the first image to upload a clear photo of the front of your ID document followed by a clear photo of the back of the document.
Next, write your Gate.io unique ID on a piece of paper and take a photo of yourself holding up your identity document (front) and the paper containing your unique ID.
Once you have done this, click on “Confirm and Submit”.
Next, you must enable the Timed One-Time Password (TOTP) to be able to log into your account. This can be done by clicking on “Set Now” at the bottom of the page.
On the new page that loads, select “Click here” to set up Two-factor Authentication.
Download Google Authenticator onto your mobile device by making use of any of the abovementioned methods.
Follow the steps indicated to add your Gate.io account by scanning the QR code or entering your unique key.
Enter the TOTP, your fund password, and the code sent to your email address and select “Enable Two-factor Authentication”. With this setup, you must use the Google Authenticator app to sign into your account every time.
Step 2 – Deposit funds
You must note that Gate.io is only a crypto-to-crypto exchange which means there is no fiat gateway. The only way through which funds can be added, is to transfer an existing crypto into your Gate.io wallet.
DAI can only be bought through Tether/USDT or Bitcoin/BTC while it can be traded with USD as a futures contract.
Navigate to the deposit/withdrawal section by hovering over your account and selecting the relevant option. Choose from the list of coins in which you can make a deposit and select “deposit” next to the appropriate coin.
You will be redirected to a page which generates a deposit address for the coin that you wish to deposit.
Copy this address, or scan the QR code, into the wallet where you are making a withdrawal from and depositing to Gate.io and wait for the relevant blockchain to confirm your transaction. Once the transaction has been completed and verified by the nodes on the chain, the coins will be sent to the Gate.io wallet and you can start trading DAI.
Step 3 – Explore your trading options
Gate.io offers a variety of ways through which cryptocurrencies can be obtained. Each of these can be explored individually depending on your trading needs and objectives.
To start trading DAI, select the option from the “Trade” Menu. Enter “DAI” into the search bar to see which trading options are available.
For spot trading, for instance and as an example, select DAI_USDT. Once you have selected, you will be directed to the exchange page which corresponds to the cryptocurrency pair DAI/USDT.
Here, you will see that you have the option to buy or sell DAI either as a limit order, grid trading, or as a time condition. The most common trading method is that of limit trading and thus it will be used for this guide.
Step 3 – Buy DAI through via Limit Order
To buy DAI and create a limit order for it, you can enter the amount you want to purchase, and the price you want to buy it at in USDT. This tool will tell you what the overall cost is in USDT, or any other chosen counter-currency, which will be deducted from your wallet once the order has been executed.
Step 4 – Sell DAI through via Limit Order
To sell DAI, find the panel under the chart and create a limit order for USDT according to your own preferences. Note that with a peg to USD, DAI that you exchange for USDT will hold the flat value that it has despite market conditions in the cryptocurrency market.
Step 5 – Withdraw funds
To withdraw funds, you will use the same page in Gate.io which was used to make a deposit.
Click on the deposit/withdrawal option on your Account dropdown and find the wallet of the currency that you wish to withdraw. You can do this easily by using the search bar provided.
Instead of a deposit address being generated, you will do this on the exchange, or the wallet being used as the destination for withdrawal of funds from Gate.io. Paste the address of the receiving wallet in the field provided and provide your Gate.io fund password, email code, and TOTP before selecting “Submit Request”.
Frequently Asked Questions
When was DAI first launched?
DAI and its associated smart contracts were launched in 2017 on the Ethereum network.
Who founded DAI?
DAI is a product of MakerDAO, which was founded by Rune Christensen.
What is “ICO”?
It is Initial Coin Offering that, unlike an IPO, does not mean that those who invest in the cryptocurrency will have an ownership stake of the company that they provide funds to.
When was DAI’s ICO and how much did it raise?
DAI did not have an ICO.
Is DAI legit?
Yes, DAI is legit.
What is DAI’s total supply?
There is no supply limit on DAI. At the time of writing, the circulating supply of DAI is 4 billion coins.
What is the purpose of DAI?
DAI is a stablecoin which aims to keep its value as close to the US Dollar as possible.
On which blockchain is DAI based?
DAI was built on the Ethereum blockchain.
Does DAI work with smart contracts?
Yes, DAI’s value is pegged to the value of the US dollar by making use of an automated system of smart contracts.
Does DAI have potential to become more valuable?
Yes, as result of increasing interest in DeFi and smart contracts, DAI is set to increase in value.
Top 4 Brokers
