MakerDAO – MKR

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MakerDAO – MKR

4 minutes
Contract adress: 0x9f8f72aa9304c8b593d555f12ef6589cc3a579a2

Today we will introduce you to MakerDAO. Maker consists of a stablecoin called DAI, collateralized loans and a decision making process done by the community. Maker – MKR is built on the Ethereum network, together with the community decision making this makes for a nice decentralized entity.

What is MakerDAO – MKR?

The project uses both cryptocurrencies. They describe themselves as a smart contract platform running on the Ethereum Network, their do is to stabilize DAI at a price of 1$ as stablecoin through a dynamic system of Collateralized Debt Positions – CDPs and the governance model. Users can deposit Ethereum as collateral to borrow DAI, it can be shipped freely, it can be traded with, etc.

The DAI is more interesting as a means of payment for companies than, for example, regular cryptocurrencies, as the DAI keeps the same value (1$) and does not fluctuate much in value like other cryptocurrencies. Not only for companies, but also for people who, for example, need money now but do not want to sell their cryptocurrencies, this can be interesting. For example:

”Bob needs a loan, so he opens a loan of 100 DAI.” This can be done by securing a value of ETH on the platform as collateral that is higher than the value of 100 DAI. Bob receives this directly on his Ethereum wallet, once he can pay off the loan he can deposit the DAI back into the platform to close the loan and get his Ethereum free”. This sounds very nice when Ethereum is rising in value, but beware, there is also definitely a pitfall in the whole thing, as it is a ‘collateral’ for a reason.

When Bob’s loan falls below the liquidation ratio traders can trigger his liquidation. In this case extra MKR will be put on the market as debt sales, these can be bought by traders. This ensures that the debt capital is covered immediately and the platform does not go underwater. If any collateral remains it will be returned to Bob. In other words, make sure your loan is not underwater.

MKR tokens are burned after the charges are paid. This decreases the supply of the utility token, so the more the platform is used, the less will be left in circulation.

This review of  Maker Dao – MKR was created for informational purposes. This article is not intended for promotion.

This review of MakerDAO – MKR was created for informational purposes. This article is not intended for promotion.

General info about MakerDAO – MKR

The Governance Model

Paying costs is not the only thing this token is good for, as a holder you can also participate in the governance model. New proposals are regularly submitted for voting, but you can also submit proposals yourself. The community will vote on these and the best proposals will be implemented. Together this makes for a decentralized whole and a fair platform.

The Team

The team currently consists of seventeen managers, three business development team members and seven community leads. These team members come from all over the world and are supported by the community members.

Maker was founded by Rune Christians. Rune is from Denmark and was previously Co-Founder of Try China, a company that recruited employees internationally for companies. Rune is supported by Steven Becker as president and COO. Steven lives in California and has experience in multiple senior positions in the areas of lending, strategies, investments and risk management.

Where is the best place to buy this cryptocurrency?

Currently, the volume of MKR is highest on OKEx and Huobi, so we recommend using one of these two exchanges, both are very well-known and reliable.

For DAI, it’s best to be on Coinbase Pro, KuCoin, or Fatbtc.

Click on any of the hyperlinks above to create an account on the exchange, and then be able to purchase the token.

Where is the best place to store this cryptocurrency?

Cryptocurrencies can always be stored in several places. You can choose to do this on a software wallet, hardware wallet or exchange wallet (not recommended). We explain more about our choices for this on this page.

Since the platform runs on the Ethereum Network these cryptocurrencies can both be stored on your Ethereum wallet. This can be for example on your Ledger, but also on your MyEtherWallet wallet.

What do we think about MakerDAO – MKR?

MakerDAO – MKR conclusion

Personally, I think this is an incredibly good project, namely thanks to the governance model that allows it to be fully decentralized. But also thanks to the mechanism by which the platform prevents insolvency and ensures that the DAI always remains around 1$. This also makes it very suitable for payments, which ensures that the technology can be used without having to run any capital risks as a company.

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