Dai (DAI)

Dai (DAI) is a decentralized stablecoin built on Ethereum as an ERC-20 token, designed to track the value of the US dollar on a roughly one-to-one basis. It was created by MakerDAO, the decentralized autonomous organization founded by Rune Christensen, and launched on the Ethereum mainnet in December 2017. Unlike centralized stablecoins issued by a single company holding off-chain reserves, DAI is minted on-chain when users lock crypto collateral, including ETH and other approved assets such as USDC, into smart contracts called Vaults.

DAI’s peg is maintained through overcollateralization of these Vaults, a governance-set stability fee, and automated liquidations that step in if collateral value falls below the required threshold. Following MakerDAO’s 2024 rebrand to Sky, a sister token called USDS was introduced as an upgraded, 1:1 convertible version of DAI, and several exchanges have since migrated trading pairs from DAI to USDS. DAI itself continues to operate unchanged and remains usable and tradable across DeFi and Ethereum-compatible networks.