Crucial milestones in the cryptocurrency industry need to be highlighted. In the case of DAI – one of the many stablecoins on the market – the network has minted over 100 million tokens this week.
Many people seem to be confused regarding DAI. Albeit it is a stablecoin, it is also subject to some very unusual interest rates not found anywhere else.
DAI is Everywhere These Days
That makes it all the more surprising to see users mint so much DAI. As the figure now sits at over 100 million, it is evident that the demand for this token isn’t slowing down.
This particular aspect raises a lot of questions. One has to wonder why MakerDAO continues to let the debt ceiling grow, as well as how people are effectively using this token today.
DAI Can only be created when someone deposits Ether into a collateralized debt position.
In return for doing so, the Ethereum holder will receive the DAI generated in the process.
This is how one creates capital – albeit fractional amounts – without selling Ether.
Given how much DAI has now been minted, there has to be plenty of ETH locked up in these positions as well.
Unlocking the ETH requires users to pay back the capital they gained plus a fee.
One logical explanation for this success is how they leverage DAI to buy other cryptocurrencies. Diversification is crucial in this industry at all times.