Dai Stablecoin

DAI

DAI is the first overcollateralized and decentralized stablecoin issued by Maker. Its value is soft pegged to the US Dollar and backed by a combination of other stablecoins and crypto assets.

Risk Rating
Best
$1.00
-0.09%
Summary
What we like
Offers a permissionless, decentralized method to gain exposure to a non-volatile store of value that is backed by its underlying collateral.
What we like less
DAI is over 30% backed by USDC, a centralized stablecoin that can blacklist any address at will.
What it means for you
DAI is a highly liquid instrument to hedge your portfolio in volatile market conditions and also an easy way to put USD to work for you in DeFi.
Information
Blockchain
  • Ethereum
Key Metrics
  • Market Cap: $5.3B
  • Fully Diluted Valluation: $5.3B
  • FDV / MC: 1
  • Ranking inside Exponential (among stables): #3
  • Circulating Supply: 5,341,779,113
  • Total Supply: 5,343,371,159
  • Volume (24H): $494.3M
  • ATH: $1.22 (03/13/2020)
  • ATL: $0.88 (03/11/2023)
Risk Assessment
Best
Asset Strength

DAI is a low-cap, fully collateralized asset. This asset depends on a centralized entity for custody services. This asset is exposed to the underlying risks of Maker, a protocol rated as Good.

DAI is a stablecoin that usually trades within 20bps of its peg to USD, which makes it a solid store of value.

Asset Tokenomics

DAI has an uncapped supply but has inflation control or burn mechanisms in place. DAI is the most battle-tested, decentralized stablecoin in DeFi. Maker uses the Peg Stability Module (PSM) as a valuable tool to maintain DAI stability. The PSM is a decentralized exchange that allows users to swap USD stablecoins for DAI at a 1:1 rate. This is another important peg stability factor as it provides liquidity around the peg.

Asset Volatility

DAI is a stablecoin that usually trades within 20bps of its peg to USD, which makes it a solid store of value. Maker uses the Peg Stability Module (PSM) as a valuable tool to maintain DAI stability. The PSM is a decentralized exchange that allows users to swap USD stablecoins for DAI at a 1:1 rate. This is another important peg stability factor as it provides liquidity around the peg.

Dependencies

Maker

Things to know about DAI

How is DAI created?

DAI is a collateral-backed stablecoin created by MakerDAO. Its value is pegged to the USD and kept stable through an economic system of aligned financial incentives. DAI is minted when users borrow against locked collateral and burned when debt is repaid.

What is DAI used for?

DAI is a price-stable asset that is mostly used as a hedge against volatility as it maintains a stable value of around 1 USD. Users need an alternative store of value and medium of exchange to navigate the highly volatile crypto markets. DAI addresses this problem for crypto native users, as well as enables a wide range of financial activities including hedging during periods of high market volatility, market making against a stable asset, use as collateral for leveraging, and payment as a medium of exchange.

How is the price of DAI kept stable?

DAI is an asset-backed currency that maintains a free-floating peg to the USD. This means that its value may differ from exactly 1 USD from time to time given current market conditions. For the most part, DAI has remained one of the most stable decentralized stablecoins to-date via a combination of external market forces, internal economic incentives, and policy tools controlled by MKR token holders. The different market actors all acting in self-interest, work in concert to maintain DAI's stability. Stability fees are one policy tool that is used to manage the circulating supply of DAI. Decreasing the stability fee, lowers the cost of borrowing, which helps incentivize the minting of additional DAI, while increasing the stability fee has the opposite effect of reducing the rate of DAI creation. Arbitragers also contribute to maintaining the DAI peg by taking advantage of price differences across various market makers. Lastly, vault owners also participate in maintaining the peg by minting DAI when spikes in demand push its price above 1 USD, and conversely purchasing DAI to pay down their debt at a discount when it trades below 1 USD.

DAI Pools
Maker USD Fee Sharing
5%
Yield 30d
$2B
TVL
Risk
A
Protocol
Maker
Chain
Ethereum
Curve USD Market Making
1.46%
Yield 30d
$196M
TVL
Risk
B
Protocol
Curve
Chain
Ethereum
Yearn USD Lending
4.57%
Yield 30d
$26M
TVL
Risk
B
Protocol
Yearn
Chain
Ethereum
Curve USD Market Making
7.92%
Yield 30d
$24M
TVL
Risk
C
Protocol
Curve
Chain
Ethereum
Convex USD Market Making
12.27%
Yield 30d
$22M
TVL
Risk
C
Protocol
Convex
Chain
Ethereum
Uniswap ETH-USD Market Making 30bp
26.36%
Yield 30d
$20M
TVL
Risk
B
Protocol
Uniswap V3
Chain
Ethereum
Curve USD Market Making
1.85%
Yield 30d
$17M
TVL
Risk
C
Protocol
Curve
Chain
Ethereum
Morpho-Aave USD Lending
5.71%
Yield 30d
$10M
TVL
Risk
C
Chain
Ethereum
Uniswap ETH-USD Market Making 5bp
17.41%
Yield 30d
$10M
TVL
Risk
B
Protocol
Uniswap V3
Chain
Ethereum
Curve USD Market Making
1.13%
Yield 30d
$9M
TVL
Risk
D
Protocol
Curve
Chain
Ethereum