If you are on the lookout for a stable currency with reduced price volatility and higher transaction security, then DAI is your answer. DAI’s price stability is maintained by its developers. MAKERDAO has been able to regulate transactions and control price volatility to a great extent. DAI stable coins are developed using its dedicated platform. This platform accepts other cryptocurrencies as well in exchange for collateral. Investors can also use fiat currencies to purchase DAI through legitimate crypto exchanges. You can visit the bitcoin evolution app to start investing in crypto.
Before getting to know further details about DAI, let us first look at the meaning of a stable coin. The stable coin may be defined as a subset of cryptocurrency. But this coin can control price volatility and also gain other benefits of cryptocurrencies. Similar to other cryptos, the stable coin is secure, carries low transaction charges, and may be traded or purchased by investors across the globe.
Stable coins are backed by fiat currency and these types of coins always carry dollar value with them. But in the past, we have also seen situations wherein the price of such stable coins goes up or decrease as well. The market has witnessed stable coins increasing to $1.2 and $0.90 as well.
These types of currencies also stick to the decentralized finance model. Like other cryptocurrencies, these coins also do not involve any third party in validating any transaction. Investors are allowed to undertake transactions without the intervention of any central bank, regulatory agency, or tax authorities.
Understanding the basics of DAI
DAI is a stable coin and carries currency value backed with the US dollar. This means, 1 US dollar equals 1 DAI. DAI was first launched in 2017. Since its launch, this particular coin became popular amongst investors. As of today, the total market capitalization of DAI stands at $ 6 billion making this a lucrative investment scheme. DAI investment has attracted both newbies and experienced traders in making their investments. Yet another added advantage is its market presence. DAI is listed on all popular exchanges including Coinbase, Kraken, etc. which makes it easier for any investor to easily make payments.
Should You Invest in DAI?
This is a fundamental question that you need to consider before making any type of crypto investment. Let us look at the growth forecast on DAI that you may help to make your investment decision.
Since DAI is directly linked to the US dollar, this stable coin waives off its price volatility your transactions and investments are always secure. This type of coin also works as collateral for other purchases. DAI is backed with Ethereum technology making every transaction secure. You can also use this token to buy any Ethereum assets. Any decentralized apps built on Ethereum technology allow you to use DAI tokens as collateral to continue using the product and service.
What are the benefits of investing in DAI?
Other than the benefits of decentralized finance and blockchain technology, let us look at a few other advantages and benefits of investing in DAI.
Generate passive income
This is the biggest benefit of investing in stable coins. Investors can buy stable coins and hold them for a longer period. Until you hold these coins, DAI provides its investors with variable interest. DAI is programmed to make these payments into investors’ accounts regularly. You can continue to earn and withdraw the funding as required.
Secure and safe transactions
DAI has an integrated wallet that allows users to keep their transactions secure. There is a dual-authentication model and other security measures that allow every investor to make their transaction and investment securities.
To conclude, DAI is flexible and allows investors to earn on the go. The price stability of cryptocurrency is taken care of. Investing in DAI can allow you to utilize Ethereum based tools. It allows you to obtain access to passive income by staking your coins. You can also earn profits on the move through your investment and also utilize coins to purchase any other tools or software utilizing a stable coin.
One drawback of DAI investment is its liquidity factor. DAI is used for collateral purposes and in most cases Ethereum is priced higher than the dollar value.