Maker are the guys behind Dai, the world's first unbiased currency and leading decentralized stablecoin. Dai is collateral-backed money whose value is pegged to the US Dollar and kept stable through a framework of aligned financial incentives. The Dai token lives on the Ethereum blockchain. Its stability is unmediated by any central party, and the ability to pay one’s debts does not rely on any trusted counterparties. All circulating Dai are generated from Maker Vaults (The Maker Vault is a core component of the Maker Protocol, which facilitates the generation of Dai against locked up Collateral.) They are backed by a surplus of collateral assets. For more information read their FAQ here.
Once generated, bought, or received, Dai can be used in the same manner as any other cryptocurrency: it can be sent to others, used as payments for goods and services, and even held as savings through a feature of the Maker Protocol called the Dai Savings Rate (DSR).
In addition to DSR, which enables Dai users to earn accruals on the Dai they save, here is a non-exhaustive list of things Dai can be used for:
In my case, I’ve been looking into how to use Maker to earn interest on Dai deposits. As I did a little more research into the DSR interest rate, I discovered that currently the saving interest rate on DAI is 0.01% on Oasis (Maker’s financial application). According to a post on the Makerdao forum, they are or have been taking measures to keep 1 DAI value close to $1. One of such measure is to set the interest at 0%. Why I am not sure.
0.01% is pretty sad. That is why I am now exploring better ways to earn interest on DAI. Some ideas are to supply more Dai at Aave (currently offering 1.88% on Dai), or Compound finance (currently offering 2.71% on Dai), a crypto bank like Nexo, or use a decentralised exchange (DEX) like Uniswap and provide liquidity in their Eth-Dai pool.
Nexo - $1.2B market cap | 103,485 addresses (wallet holders) | ‘B’ positive outlook Fundamental Crypto Asset Score (FCAS ) | Github repo couldn’t see any public contributors and last update was 4 years ago (red flag).
Source: coinmarketcap Nexo
I’ll be looking into Uniswap next. Although in their case, I’ll be earning fees and not interest.