On the 19th of November, MakerDAO launched their new highly-anticipated, multi-collateral Dai (MCD). The next-gen version of the Dai stablecoin you’re already familiar with, its value is pegged to multiple assets which provides an even greater degree of stability for remittance and hedging.
Before we get into any of the finer details, let’s check out the changes in terminology:
- Collateralized debt positions = Vaults
- Multi-collateral Dai token = Dai
- Single-collateral Dai token = Sai
Confused? We don’t blame you. Essentially, single-collateral DAI – the ‘old’ version of the stablecoin - is now known as Sai, while the updated, multi-collateral token inherits the Dai moniker.
What does this mean?
First of all, if you already hold Dai with Wirex there’s no need to fret. Your account automatically upgraded to MCD-Dai on December 2nd. That means you can experience the benefits of this next-gen stablecoin with no hassle whatsoever. If you don’t own any, multi-collateral Dai is now available for purchase and exchange in the Wirex app.
So why the change?
Stability. According to MakerDAO, Dai represents the future of digital money. Dai (now Sai) was the world’s first decentralised stablecoin designed to facilitate economic growth on the blockchain. It’s pegged to USD, so every Sai is worth $1 and always will be. However, even fiat-pegged stablecoins are subject to market movements and fluctuations in value – enter multi-collateral Dai.
The launch of MCD provide an extra layer of security and stability for Dai holders. Not only is it backed by multiple assets, your tokens are held at a constant value thanks to the Dai Savings Rate.
The DSR means that Dai holders are able to lock up their stable currency in a contract whilst simultaneously earning additional savings on their Dai. Users are able to deposit and withdraw from their savings account whenever they want using a MakerDAO dapp (decentralised app).
As Rune Christensen, MakerDAO CEO, explains, ‘The DSR will not only allow users to earn on Dai held, but will also immediately create an entirely new dimension for innovative Maker protocol integration on the backend of DeFi dapps.’
We couldn’t have put it better ourselves. If you’re interested in exploring multi-collateral stablecoins, open an Wirex account and start buying, exchanging and spending innovative cryptocurrencies like Dai today!