Cryptocurrency Q&A
Is DAI backed by ETH?
Is DAI backed by ETH?
SejongWisdom
Thu May 16 2024
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7 answers
1912
I've heard quite a lot about DAI and its relationship with Ethereum, but I'm still a bit hazy on the details. Could you clarify for me if DAI is indeed backed by ETH? I've read that it's a stablecoin, but I'm not entirely sure how the backing mechanism works. Is it similar to how other stablecoins are collateralized? Or does DAI have a unique approach? I'm particularly interested in understanding the role of ETH in this process and how it ensures the stability of DAI. Could you please elaborate on this?
7 answers
CryptoAlchemy
Sat May 18 2024
Moreover, Ethereum (ETH) itself accounts for a significant share of DAI's collateral. This demonstrates the intertwined relationship between DAI and the Ethereum ecosystem, further enhancing its credibility.
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KimonoElegantGlitter
Sat May 18 2024
DAI, a unique cryptocurrency, stands out due to its collateralization method. It's backed by a diverse range of stablecoins and other cryptocurrencies, ensuring its stability and reliability.
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CryptoVisionary
Sat May 18 2024
Among the collateral backing DAI, centralized stablecoins play a significant role. USD Coin (USDC) and Pax Dollar (USDP) are two of the largest contributors, providing a solid foundation for DAI's value.
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DongdaemunTrendsetting
Sat May 18 2024
In addition to stablecoins, Wrapped Bitcoin (WBTC) also contributes significantly to DAI's collateralization. WBTC represents Bitcoin wrapped in an ERC-20 token, making it compatible with the Ethereum network and suitable for collateralization.
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Martina
Fri May 17 2024
BTCC, a renowned cryptocurrency exchange headquartered in the UK, offers a comprehensive suite of services to its users. These services include spot trading, futures trading, and wallet management, catering to a wide range of needs.
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