DAI – everything you need to know about the stable cryptocurrency
Many people who invest in cryptocurrencies are aware that cryptocurrencies generally have very high volatility.…
Those who invest in cryptocurrency know that they take a big risk when they do. For the same reason, many choose to refrain from investing in it. The reason for this is that they simply do not want to take the chance, because investing in cryptocurrency is a dangerous game of chance.
However, it depends on which cryptocurrency you choose to invest in. Most cryptocurrencies are known to have relatively high volatility, meaning that the value can increase and decrease faster than it takes you to get ready for work in the morning, even after 5 years of practice!
More stability with Stablecoins
But after DAI entered the crypto market, this is not something you need to worry about anymore. As a stable coin, DAI is characterized by the fact that the volatility of this cryptocurrency is not as high. Instead, it is much lower and much more stable, which is very convenient for everyone.
In this article, we will take a closer look at DAI, and get better acquainted with this cryptocurrency. In addition, we will also give you some tips that can come in handy when investing in DAI after you have finished reading this text.
What is DAI?
DAI is a cryptocurrency that can be referred to by different names. Is it perhaps the saying “dear children have many names” that strikes here? These are at least some of the ways DAI can be described:
DAI (which is the very name of the cryptocurrency).
Ethereum-based stablecoin (for DAI is a form of stablecoin, which we will look at a little further down in this article).
ERC20 tokens on the Ethereum blockchain (another way of saying “Ethereum-based stablecoin”).
Like most other cryptocurrencies, DAI is decentralized . This means that no third party is involved in the process when a transaction is carried out with the cryptocurrency DAI. But DAI stands out from the rest, because it is a stablecoin.
Unlike the other cryptocurrencies, not a single developer was responsible for the development of DAI. Behind this cryptocurrency we actually find an organization. Specifically, the organization MakerDAO. It is a decentralized, autonomous organization.
This organization was launched by Rune Christensen in 2014, but it took a few years before DAI was launched. DAI was launched as a cryptocurrency, first in 2017. This means that this is a cryptocurrency that is relatively new, in that it has not been on the market for very long.
DAI is a type of Stablecoin
DAI is, as mentioned, a type of stablecoin. But what do we really mean by stablecoin? We also mentioned above that this is the reason why DAI stands out from the amount of cryptocurrencies. What exactly is a stablecoin, and why does it stand out from the rest of the cryptocurrencies?
Like DAI, stablecoin is a cryptocurrency. But there are several types of stablecoins, which means that stablecoin also serves as a kind of common term for different forms of cryptocurrency. Stablecoin can be divided into the following main groups:
Stablecoin with security in fiat .
Stablecoin with security in cryptocurrency.
Stablecoin without security.
As a cryptocurrency, DAI falls under the second main group. In other words, DAI is a form of stablecoin with security in cryptocurrency. In practice, this means that you can invest in DAI, as long as you can provide other forms of cryptocurrency as security for the investment.
This can be explained with a relatively simple example. If you have invested in, for example, Bitcoin and Ether before, you can use this as security for the investment in DAI. However, it works the way the sum of cryptocurrencies has to be higher than it is in DAI.
DAI is a safer investment, many will probably think – since volatility is so low compared to other types of cryptocurrency.
Benefits of DAI
DAI is a very popular form of cryptocurrency. This is of course due to the fact that the volatility of this cryptocurrency is much lower than with the traditional cryptocurrencies, which means that the risk is much less with this cryptocurrency.
But that, of course, is not the only reason why this cryptocurrency is a good alternative. Below is a closer look at some of the reasons why more people should choose DAI when considering investing in cryptocurrency.
As a stablecoin, DAI is cheaper
As we have already mentioned a few times, DAI is a form of stack coins. This is a cryptocurrency that is known for a much more stable curve in the crypto market today.
Stablecoins have a much lower volatility than the rest of the cryptocurrencies we know. This means that DAI also has a much lower volatility than, for example, Bitcoin. The risk of investing in DAI is thus not as great as it would be if you invest in Bitcoin.
This is very convenient for everyone. But mostly for those who may want to invest in cryptocurrency, but who leave it because of lack of experience and too much risk. DAI (and Stablecoins in general) is perfect for the group that wants to try their luck at this here!
But even though DAI and Stablecoins are generally cheaper, it is important to keep in mind that there will always be some risk in investing in cryptocurrency. Low or high volatility, it is after all cryptocurrency we are talking about. It is very important that you do not forget it!
There are no restrictions on the use of stack coins / DAI
It can also be said that there are no restrictions on the use of stack coins. And since DAI is a form of stack coins, it also applies to the use of DAI. This is something that is very convenient!
Using stack coins and DAI is something you can do at all hours of the day. These forms of cryptocurrency are available whether it is light or dark outside, so you can speculate on this just when you feel like it or feel like doing so.
The fact that there are no restrictions on the use of stack coins and DAI also means that these cryptocurrencies are available to a much greater extent than any of the other cryptocurrencies combined. And of course it is very convenient!
Simple and efficient customization
Like a stack coin, DAI builds on codes. And the developers behind stablecoins have arranged it so that it is entirely possible for the developers to re-enter the code and change the original code should it prove necessary.
In practice, this means that stablecoin and DAI are based on adaptable technology. In addition, there is a technology that it is possible to change afterwards, which is practical because then DAI can always be on a par with the rest of the cryptocurrencies in the crypto market.
This little detail also makes it easier for those working in the back room of Stablecoins and DAI to do their job. Instead of having to do everything again every single time (as you often have to in connection with cryptocurrency), you can do what you need to in a very simple way.
Higher value than other cryptocurrencies
As mentioned, DAI is characterized by a much lower volatility than most other cryptocurrencies. This also means that this cryptocurrency has a much greater value than the other cryptocurrencies.
But it is not just the value that is higher in connection with DAI. The stability that DAI has thanks to the fact that it is a stack coin also leads to something positive financially. We are naturally talking about stablecoin and DAI experiencing less chance of inflation.
Inflation comes as a result of the high volatility, but since this is something that stablecoins and DAI do not have, it naturally means that this is something that falls away in connection with stablecoins and DAI. And it is without a doubt very convenient for all parties.
Is DAI a good investment?
DAI is a very popular form of cryptocurrency. In practice, this simply means that this is a cryptocurrency that many people use when they want to invest in cryptocurrency. And it is without a doubt a smart choice.
Since DAI can be categorized as a form of stablecoins, or more specifically «stablecoin with security in cryptocurrency», and thus is known for a much more stable price level, the cryptocurrency DAI will be a very good choice. So yes, it’s a good investment!
By investing in DAI, you do not have to worry about much of what you are guaranteed to worry about in connection with other cryptocurrencies. For example, Bitcoin, which has high volatility, can cause you to lose much more money than DAI will do.
But despite the fact that DAI can be considered a good investment, it must be said that it is important to have a healthy relationship with it all before you start investing. DAI is a good investment, but you should never invest more than you can actually afford to lose anyway.
How to invest in DAI
Are you considering investing in DAI? Then we can assure you that you make a very good choice once you have decided to invest in one or another cryptocurrency.
DAI will be a good cryptocurrency to invest in, regardless of whether you have a lot of experience in investing in cryptocurrency or not. Especially if you do not like the idea that you can potentially lose quite a lot of money. If you do not feel like it then you should definitely choose DAI!
However, investing in DAI is the result of a small process. The process consists of several steps, and below we will go into more detail on what you have to do in each step to get the result you want in the end.
Which cryptocurrency do you want to invest in?
First of all, you have to find the answer to this question. Which cryptocurrency do you want to invest in?
There are many different cryptocurrencies on the market today. Not only in general, but also within what are referred to as stack coins.
But since this is an article about DAI, it is more or less a matter of course that you should choose this cryptocurrency when you are going to invest in some form of cryptocurrency.
Find a crypto exchange that offers DAI
Once you have figured out which cryptocurrency you want to invest in (which in this case is DAI), then you need to find a cryptocurrency exchange that offers this cryptocurrency.
But it is important not to forget that DAI is actually a very popular cryptocurrency due to the way it is structured, so it will probably not be the most difficult task in the world to find a cryptocurrency exchange that offers this cryptocurrency.
In fact, there are many good crypto exchanges that offer the cryptocurrency DAI, which are also Norwegian. In practice, this means that you will probably feel a little more secure on the current crypto exchange, since you know the payment methods they use from before.
There are many good crypto exchanges out there. Some of the crypto exchanges that we know for sure that DAI offers are the crypto exchanges eToro and Firi. Firi was previously known by the name MraiEx, so you may have heard of them already under another name.
Registration and creation of a user account
Once you have found out which crypto exchange you want to use, just start registering (unless you have done this before and have already gone through this process at an earlier time). Then just skip it.
How to register and create a user account can vary slightly from crypto exchange to crypto exchange, so when you do that, just follow the steps that the crypto exchange presents to you. There is a lot of good information on how to do this there!
Invest in DAI
Once all the formalities are in place, there is only one thing left. And that is to start the process of investing in DAI.
Since DAI is a stack coin with security in cryptocurrency, it is also important that you have values in the form of one or more cryptocurrencies at the time you start the investment.
Many people who invest in cryptocurrencies are aware that cryptocurrencies generally have very high volatility.…