Issuer explainer

What Is DAI?

DAI is the original decentralized, crypto-collateralized stablecoin. Here is how it works and how it relates to USDS and Sky, with live market data.

DAI is a decentralized U.S. dollar stablecoin launched in 2017 by MakerDAO, now part of Sky. It pioneered the crypto-collateralized model and is governed by a decentralized protocol rather than a single company.

DAI is minted when users lock collateral into smart-contract vaults, and it is over-collateralized so the value backing it exceeds the supply. It remains widely used across DeFi, and can now be upgraded to the newer USDS.

How DAI is collateralized

DAI is created against a basket of collateral, including crypto assets and tokenized real-world assets, locked in Maker/Sky smart contracts. The system is over-collateralized and uses automated liquidations and governance to defend the peg.

DAI and USDS

Under the Sky rebrand of MakerDAO, USDS is the upgraded successor to DAI. DAI continues to operate, and holders can upgrade DAI to USDS to access newer features such as the sUSDS savings token. See our USDS explainer.

What DAI is used for

  • A decentralized dollar with no single corporate issuer
  • Collateral, lending, and liquidity across DeFi
  • On-chain settlement available 24/7

Market data from CoinGecko, refreshed on each deploy. Editorial details per issuer disclosures. Not investment advice.

FAQ

DAI, answered

What is DAI?

DAI is a decentralized U.S. dollar stablecoin launched in 2017 by MakerDAO, now part of Sky. It is crypto-collateralized and over-collateralized, minted when users lock collateral into smart-contract vaults, and governed by a decentralized protocol.

How does DAI stay at one dollar?

DAI is over-collateralized: the crypto and real-world assets locked in Maker/Sky vaults are worth more than the DAI issued. Automated liquidations, stability fees, and governance mechanisms keep it near one dollar.

What is the difference between DAI and USDS?

USDS is the upgraded successor to DAI under the Sky brand. DAI still exists and can be upgraded to USDS, which adds features such as the sUSDS savings token.

Is DAI safe?

DAI has a long track record and is over-collateralized, but it carries smart-contract risk, collateral risk, and governance risk. Its stability depends on the health and management of its collateral basket.