DAI is a decentralized, collateral-backed stablecoin that aims to maintain a 1:1 peg to the U.S. Dollar, created by the MakerDAO protocol on the Ethereum blockchain.
---
📌 Key Facts About DAI:
Feature Details
Token Symbol DAI
Type ERC-20 (Ethereum-based)
Peg Soft-pegged to 1 USD
Collateralized By Crypto assets (e.g., ETH, USDC, WBTC, etc.)
Governed By MakerDAO (a decentralized autonomous organization)
Launched December 2017
---
⚙️ How DAI Works:
Users deposit crypto assets (like ETH, WBTC) into Maker Vaults.
In return, they mint DAI — effectively borrowing DAI against their collateral.
If the collateral drops too much in value, the position can be liquidated to keep DAI backed.
The system uses smart contracts and overcollateralization (e.g., $150 of ETH to mint $100 of DAI).