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Dai is backed by lots of different assets in the Maker Vaults. Most of them are crypto but they just added some real estate assets and the plan from day one has
by Sargos 5y ago
Dai is backed by lots of different assets in the Maker Vaults. Most of them are crypto but they just added some real estate assets and the plan from day one has been to add as much diversified collateral as possible for safety and scale (Dai can't scale big enough to service the entire world on crypto backing alone).
- riffraff 5y agoHow are non-crypto assets represented in crypto space? It seems you would need a trusted party/oracle of some kind, which creates the same problem as centralized stablecoins anew. Edit: indeed a sibling comment mentions they have USDC as a backing support which means they are as stable as that.
- whimsicalism 5y ago> It seems you would need a trusted party/oracle of some kind, which creates the same problem as centralized stablecoins anew. If it is multicollateral, then yes, it somewhat involves trust, but you are dependent on a lot of various people betraying trusts along with ethereum price dipping, whereas a traditional stablecoin is entirely dependent on one entity.
- shkkmo 5y agoDivirsification of assets does help reduce risk. However, you can't eliminate that risk without holding reserves that are entirely made up of the pegged currency.