Cyberdevisen – Dai cryptocurrency will become a “global payment” world | news
The extreme price fluctuations of Bitcoin & Co. hinder the acceptance of cryptocurrency as a general means of payment. Stablecoins fight this gap by coupling their price to one or more real currencies. For example, the online Facebook network is following this path with its planned Libra cyberdvision. Some issuers also deposit their digital coins with investments such as gold.
However, from the point of view of some users, both variants have a decisive disadvantage: they remain dependent on institutions such as central banks and commercial banks. The former control the exchange rate of the dollar, the euro and others through monetary policy; the latter keep the deposited deposits.
The creators of the cryptocurrency Dai want to circumvent this dependence by using as security no national currency, but with Ethereum, the second most important cyber-instrument in the world after Bitcoin. This has the advantage that users, once they have purchased Etherum for dollars or euros, can operate completely independently of government agencies or banks.
The second major obstacle to becoming a virtual and global “payment instrument for the people” is the threat of price turbulence. Here, the choice of Etherum as security appears initially as a contradiction in itself, because its price fluctuates as strongly as that of Bitcoin. Therefore, the Dai price is based on the dollar, but is not rigidly coupled to the US currency. Dai manufacturers are striving to obtain for their own data a 1: 1 track record, which they wish to achieve via various correction mechanisms.
“Anyone can read books in real time”
To reach Dai, users must first deposit Ethereum into a publicly accessible account type called Debt Guarantee Position (CDP). Further price stability, manufacturers of Dai-Makers promise that the payment amount is always lower than the deposit in order to have protection against Ethereum price changes. If the Dai price is further away from the dollar, the buffer size in the CDP is automatically adjusted. So, if the price goes down, users will have to deposit more Ethereum to get the same amount of Dai. In addition, users return to the Ethereum parked in the CDP only if they have repaid the Dai deducted, plus “stability fees”.
All of these transactions are stored in the blockchain, says Rune Christensen, head of the Dai Maker Foundation. “Anyone can read the books in real time.” Blockchain technology is the basis of all crypto-currencies. In the long run, the Maker Foundation, which is currently working on technology, even wants to make it superfluous. The goal is to refine the system so that no additional monitoring is needed, says Mariano Conti, head of the Smart Contracts department. Experts describe the blockchain programs as smart contracts, which trigger payments under certain conditions.
The charity Oxfam is already testing Dai in Vanuatu, an island nation in the South Sea, regularly hit by natural disasters. Cryptocurrency allows victims to receive quick and direct help in such cases, said Sandra Hart, an Oxfam employee. In the coming years, field trials should be expanded.
Popular in Argentina
Even in Argentina in crisis, Dai is enjoying increasing popularity. According to the Maker Foundation, the number of members of a newsgroup using the Telegram messaging service in a newsgroup using the Telegram messaging service doubled to 450. “My mom and I are spending some of our money in Dai “, explains Romina Sejas, law student. For the national currency, the peso has lost a lot of value. “We need to be creative to survive the decisions of politicians.”
However, Timothy Stranex, co-founder of the Luno crypt market, warns of the risks. Ill-programmed smart contracts could steal digital coins. Dai manufacturers want to counter this danger with an “emergency stop”. In case of hacker attack, users automatically receive their credit.
In addition, the way legislators react to Dai is unclear. Facebook blows into his Libra project, although strong headwinds show up in the face, a uniform line on the other currency notes, but the authorities have not been able to penetrate it. “Regulators are trying to impose these new technologies on existing legal frameworks,” said cryptocurrency lawyer Phil Angeloff of Clifford Chance.
|CryptoCurrency||USD||Change 1h||Change 24h||Change 7d|
|Bitcoin||0.66 %||0.38 %||13.27 %|
|Ethereum||1.21 %||1.75 %||18.06 %|
|XRP||1.08 %||0.58 %||17.51 %|
|Tether||0.21 %||0.11 %||0.18 %|
|Litecoin||1.20 %||0.60 %||24.43 %|
|Chainlink||0.89 %||1.09 %||9.75 %|
|Bitcoin Cash||2.95 %||1.53 %||8.69 %|
|Cardano||0.72 %||1.15 %||17.71 %|
|Polkadot||0.83 %||2.24 %||10.84 %|
|Binance Coin||0.58 %||0.66 %||7.99 %|
|Stellar||1.24 %||0.49 %||10.54 %|
|Bitcoin SV||8.61 %||7.82 %||11.00 %|
|USD Coin||0.02 %||0.07 %||0.08 %|
|EOS||0.80 %||0.05 %||4.36 %|
|Monero||0.22 %||5.01 %||12.98 %|
|Wrapped Bitcoin||0.65 %||0.44 %||13.29 %|
|TRON||0.88 %||0.42 %||6.93 %|
|NEM||3.17 %||13.81 %||51.32 %|
|Tezos||1.31 %||0.20 %||7.95 %|
|cDAI||0.04 %||0.47 %||0.16 %|