DAI is a decentralized, digital currency that has been gaining traction with cryptocurrency users since its launch in 2017. It was developed by MakerDao – an open source platform focused on providing financial services and products to the public using blockchain technology.
The DAI token provides stability through its algorithmically managed supply of coins which are backed by Ether (ETH) and other collateralized assets held in smart contracts, ensuring that there will never be more or less than the amount needed to meet global demand for the asset. This system allows users to generate their own tokens pegged against existing cryptocurrencies such as ETH or BTC, creating what’s known as “stablecoins”. By doing so, users can protect themselves from price volatility while still participating in crypto markets without incurring risk associated with more volatile currencies like Bitcoin (BTC).
Additionally, it offers a wide range of advantages over fiat currencies; including near-instantaneous transactions worldwide at minimal cost regardless of country borders or banking systems; transaction security enabled by blockchain-based encryption technologies; privacy protection due to decentralization characteristics; and programmable money features enabling developers to create innovative applications utilizing DAI’s infrastructure.
Ultimately, this makes DAI one of the most promising stablecoin solutions available today – offering both greater convenience compared with traditional forms of payment along with increased safety when transferring funds across international boundaries due to its relative anonymity and impenetrability compared with centralized monetary systems overseen by governments or large banks
