DAI is an ERC-20 stablecoin token with a fixed price of $1.
Through the Maker platform, it can be "loaned" by smart contracts called “collateralized debt position”, using Ethereum (ETH) as collaterals. The contracts lock a volume of ETH as a collateral and grant DAI proportionally, charging a small fee in MKR (which is burned). The collateralized ETH can be fully retrieved once the DAI loan is paid.
Unlike other stablecoins, DAI isn't backed by a physical asset, but by ETH. In doingShow more [+] he collateralized rates are set by voters on the Maker blockchain to reflect ETH variations in relation to USD and thus maintain a positive collateral balance. In cases where the collateralized value in a CDB becomes lower than the minimum amount needed to cover for the DAI loaned (as a result from ETH devaluations), the locked ETH is sold and the contract is liquidated.
If the amount of collateral is not enough to back the loaned DAI, more MKRs are created and sold in the open market to cover it. Thus, MKR voters are encouraged to set intelligent collateralization parameters that both encourage new contracts, increasing the MKR value while accounting for defaults risks.
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BTC
1MhJJKDEdRTPjDK6oRjq7LYF8nvc6nwT9X
ETH
0x878330469300301859ca7549869b66e98a08511c
LTC
LLpKbWkJ8FUtvzRdj8wgwBYu3XyBVmqMSL
BCH
qq6cc539pekzs9hhjekrptecd8u9umfpjgf85tyy6e
DASH
XnePqvwndoiKUmpwccZ8qtGjF6BBAwj6xD
ETC
0xb45b3de6780a07cacde2249df4a5068bd10860f4
XVG
DBgKdG6SwwvY85VeKrp6VkxBjXGZnKhsta
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