Dai (DAI)USD

Dai is a decentralized stablecoin on the Ethereum blockchain, backed by crypto collateral and designed to stay close to one US dollar through smart contracts, overcollateralized loans, and automated feedback mechanisms. It is governed by MakerDAO, a decentralized autonomous organization whose members hold the separate MKR governance token and vote on protocol parameters. MakerDAO was founded by Rune Christensen around 2015, and Dai launched in 2017 as one of the earliest Ethereum-based stablecoins. A multi-collateral upgrade followed in November 2019. Rather than relying on a bank or fiat reserves, Dai is created when users lock approved collateral assets into Maker vaults, which are smart contracts that enforce overcollateralization ratios. Dai is destroyed when users repay their positions and reclaim their collateral. Ethereum's proof-of-stake consensus handles transaction validation, while Dai's dollar peg is maintained by the Maker Protocol's internal stability mechanisms and MKR holder governance. The DAI token is used as an on-chain currency, a unit of account, and a medium of exchange across decentralized finance applications, including lending, borrowing, trading, and remittances. Because supply expands and contracts with user activity in Maker vaults, DAI has no fixed or capped supply. It is an elastic, market-responsive stablecoin.