Dai is a stablecoin that’s greasing the wheels of the Ethereum network.
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Approximate Market Cap: $1 billion
Year Established: 2014
Cost Per Transaction: Nominal
2020 Return: 0%
Score: ★
Like Tether, Dai is a stablecoin whose value is pegged 1:1 to the U.S. Dollar. Its technology, however, is a little more complicated. Built on the Ethereum network, Dai allows investors to borrow money using Ether as collateral. In the past, it has also allowed savers to earn up to 8.75% interest. The rate has since dropped to zero.
That’s why investors looking for simple buy-and-hold altcoins should consider Tether instead. While Dai might help Ethereum, its interest-generating ability remains low, as does its upside.
On the date of publication, Tom Yeung did not have (either directly or indirectly) any positions in the securities mentioned in this article.
Tom Yeung, CFA, is a registered investment advisor on a mission to bring simplicity to the world of investing.