Trade DAI and MKR on ShapeShift
If you’re in the crypto space, you’ve probably noticed the rise of DAI and the buzz recently surrounding it.
DAI is a collateral-backed decentralized stablecoin that runs on the Ethereum blockchain. A stablecoin is a cryptocurrency that is pegged to another stable asset. In DAI’s case, it achieves rough parity with USD, so 1 DAI roughly equals 1 USD in value.
The Maker organization is attempting to bring stability to cryptocurrency.
The Maker token (MKR) gives DAI its stablecoin properties, holders of MKR oversee governance and management of the contracts that maintain the stable value of DAI at roughly 1 USD. It’s pretty futuristic stuff.
Arguably, Maker addresses a crucial problem in today’s Ethereum ecosystem: that the price of cryptocurrency is too volatile to be today’s everyday currency. So far, Maker has succeeded in achieving the most popular decentralized stablecoin in the world.
Trade Maker (MKR) with ShapeShift
MKR has three functions: a utility token, a governance token, and a recapitalization resource.
- Utility Token: MKR is the required payment method for the fees that you accrue when generating DAI in the Maker ecosystem. These fees can only be paid in MKR.
- Governance Token: MKR is used to vote on the risk parameters in the Maker ecosystem. This voting process helps to solve problems such as “how much extra collateral is required for generating DAI?”
- Recapitalization Resource: This feature protects the system from insolvency. It ensures that should the voters not govern the ecosystem well and it becomes undercollateralized as a result, a feature is triggered and new MKR is created to bring it back from insolvency.
Over to You
Our closed beta testers are trading DAI and MKR on the new ShapeShift. What are you waiting for?