Maker (MKR) is a cryptocurrency project implemented on Ethereum platform. The native cryptocurrency of this project is ERC-20 standard token…
Maker (MKR) is a cryptocurrency project implemented on Ethereum platform. The native cryptocurrency of this project is ERC-20 standard token MKR that can’t be mined. Maker organization produces the stablecoin DAI, which has no volatility and its price pegged to the U.S. dollar. Well, it tries to and as MakerDAO’s CEO stated earlier this year:
It’s never exactly at $1. You can always buy it for slightly above $1 and sell it for slightly below. But it’s much closer to $1 now.Rune Christensen, source: breakermag.com
We all know about other stablecoins like Tether and True USD. However, these coins face a lot of critics for being low-transparent. Maker project, represented by MakerDAO, tries to stabilize Dai coin with the inner MKR coin. This approach is close to partially reserved banking, in which only a small part of its deposit obligations are required of a bank.
Why is this cryptocurrency so different from the rest of the stablecoins? Let’s find out with Changelly!
DAI is a secured asset of a stable currency of the 21st century and the first decentralized stable coin on the Ethereum blockchain. Using external market mechanisms and economic incentives, the Maker platform stabilizes the cost of a DAI at 1 USD, while full control of processes in the Ethereum blockchain eliminates the need to trust centralized organizations and worry about external audits.
As was mentioned before, Maker (MKR) coin is an ERC-20 coin based on the Ethereum platform. Maker is transparent about its blockchain development cause Maker staff publishes recordings from every meeting on the SoundCloud page.
MakerDao produces DAI coins using CDP smart contracts. This type of smart contract is called Collateralized Debt Position (CDP). So it’s baked with Ethereum cryptocurrency, and ETH tokens cover all the assets. CDP contracts contain ETH, and if anything happens, MKR coin cover all the losses. More than 2.1 million ETH was locked in the Maker CDP contract.
The DAI emission scheme can be compared to the issue of money secured by gold. The difference is that Ether cryptocurrency is used instead of gold: the user sends a certain amount of ETH to the smart contract that issues the token.
MakerDAO has a partnership with Digix, Request Network, CargoX, and OmiseGO. So the stablecoin becomes more and more viable as long as new alliance occurs.
Customers can use Dai only if he deposits another cryptocurrency to cover-up assets. It’s like a merchant financing his credit. If the prices of the collateral currency fall, new Maker coins are issued. They are sold to make up the difference.
In this case, the price of the Maker coin is reduced, because there are more MKR coins in circulation. If prices in the collateral currency remain unchanged or increase, Maker coins are not needed at all. Then the coins of the manufacturer MKR are destroyed, which increases the price of the MKR for investors.
Maker is not managed by any central fund, like Bitcoin and Ethereum. Instead, there is a decentralized group of Maker enthusiasts and developers, the best of whom have become famous in the community and have become Maker leaders. These are people like Kenny Rowe who devote most of their waking hours to the development and marketing of the Maker system.
There are only about 600,000 MKR in circulation. This is very little for the scope of cryptocurrency. Bitcoin has a relatively small margin of 17 million, and Maker coins make up only about 3.5% of this value. As Maker became widely used, this led to an increase in prices for individual MKR coins.
Maker ranks 23rd in terms of market capitalization among all cryptocurrencies; it’s $576,135,749. The highest price was tested on Jan 18, 2018, and the coin was worth $1,773.92. The all-time low price was registered on Jan 30, 2017, and was only $21.06. Now MKR coin is trading for $576.14.
Four markets can benefit from the use of DAI stablelcoin:
In the last month, MakerDAO presented a roadmap with already made things in this year. The main task facing the development team for this year is launching the Multi-Collateral Dai (MCD) on Mainnet. This goal will be achieved by completing the following steps:
To explore detailed roadmap, please, visit the MakerDao blog page.
The Maker Foundation, a non-profit organization in partnership with Coinbase and the Zeppelin platform, conducted a second round of an audit of a smart contract to vote on the MakerDAO network, during which a critical vulnerability was discovered. The developers initiated an urgent upgrade.
Users who opened a steak in MKR in the management contract for voting (approximately 190 addresses at the time of release) should immediately withdraw funds from the old contract to a private wallet.
However, the developers stressed that user funds remain secure, and the vulnerability has already been fixed. Those who do not participate in the voting are not referred to this problem.
Since Maker is an ERC-20 Ethereum coin, you can use any Ethereum Wallet that suits you the best.
It’s easy to exchange MKR coins due to a significant number of platforms accepting this cryptocurrency.
Changelly platform offers you a way to buy MKR with your banking card swiftly, safely, and with minimal authentication procedure. The fiat payment process is powered by our partner Indacoin and takes just a few simple steps to take.
[add-changelly-widget from=usd to=mkr]
The purchase option is open both via our website and the Exchange Widget that can be found at our partners’ resources.
The entire Maker system is based on the expectation that the cryptocurrency will flourish in the future. In this case, Maker does not need to save the DAI pledge. Instead, MKR owners will become wealthy and get the right to use their MKR property to vote in the Maker community.
Maker Coin is one of the best cryptocurrency concepts that allows stablecoin, as reliable as DAI, to exist. His future is unclear, but with such a strong product and such a reliable international team of users and supporters, we think that the future of the Maker coin is probably bright.
Those who invest are likely to receive a generous reward, since the Maker coin has become more widespread, and the cryptocurrency industry is growing overall.
Disclaimer: This article about Ethereum (ETH) should not be considered as offering trading recommendations. The cryptocurrency market suffers from high volatility and occasional arbitrary movements.
Any investor should research multiple viewpoints and be familiar with all local regulations before committing to an investment.