# Dai > stablecoin cryptocurrency on the Ethereum blockchain generated by MakerDAO **Wikidata**: [Q102230654](https://www.wikidata.org/wiki/Q102230654) **Wikipedia**: [English](https://en.wikipedia.org/wiki/Dai_(cryptocurrency)) **Source**: https://4ort.xyz/entity/dai ## Summary Dai is a stablecoin cryptocurrency on the Ethereum blockchain, generated by MakerDAO. It is designed to maintain a stable value by being pegged to the US dollar, making it a decentralized alternative to traditional fiat currencies. ## Key Facts - **Instance of**: Cryptocurrency, stablecoin, ERC-20 token, smart contract, and free software. - **Based on**: Ethereum blockchain and the ERC-20 standard. - **Operator**: Managed by MakerDAO, a decentralized autonomous organization (DAO). - **Inception**: Launched on December 18, 2017, as part of the MakerDAO system. - **Cryptocurrency code**: DAI. - **License**: GNU Affero General Public License, version 3.0 or later. - **Website**: [makerdao.com](https://makerdao.com) (English). - **Source code**: Hosted on [GitHub](https://github.com/makerdao/dss). - **Versions**: Released in multiple iterations (0.2.1 to 0.2.10) between March and July 2019. - **Copyright status**: Copyrighted. ## FAQs ### Q: What is Dai, and how does it work? A: Dai is a decentralized stablecoin pegged to the US dollar, issued by MakerDAO on the Ethereum blockchain. It maintains stability through a system of smart contracts and collateralized debt positions (CDPs). ### Q: Who created Dai, and what is MakerDAO? A: Dai was created by MakerDAO, a decentralized autonomous organization (DAO) that operates without central control. MakerDAO governs the Dai stablecoin and its underlying smart contracts. ### Q: How is Dai different from other stablecoins? A: Unlike centralized stablecoins like USDT or USDC, Dai is fully decentralized, meaning it is not controlled by a single entity. It relies on smart contracts and collateral to maintain its peg to the US dollar. ### Q: What blockchain is Dai built on? A: Dai is built on the Ethereum blockchain and follows the ERC-20 token standard, making it compatible with Ethereum-based wallets and decentralized applications (dApps). ### Q: How can I use Dai? A: Dai can be used as a stable value store, a medium of exchange, or a collateral asset in decentralized finance (DeFi) applications. It is widely supported by Ethereum-based wallets and DeFi platforms. ## Why It Matters Dai represents a significant advancement in decentralized finance (DeFi) by providing a stable, decentralized alternative to traditional fiat currencies. Unlike centralized stablecoins, Dai is governed by MakerDAO, a decentralized autonomous organization (DAO), which ensures transparency and community-driven decision-making. By pegging its value to the US dollar through smart contracts and collateralized debt positions (CDPs), Dai addresses the volatility issues common in other cryptocurrencies. This makes it a crucial tool for users seeking stability within the decentralized financial ecosystem. Dai’s adoption in DeFi applications, such as lending, borrowing, and trading, has contributed to the growth of the broader DeFi space, demonstrating the potential of decentralized financial systems to challenge traditional banking and financial institutions. ## Notable For - **Decentralized governance**: Operated by MakerDAO, a decentralized autonomous organization (DAO), ensuring no single entity controls the stablecoin. - **Smart contract-based stability**: Uses collateralized debt positions (CDPs) to maintain a 1:1 peg to the US dollar, providing financial stability. - **ERC-20 compatibility**: Built on the Ethereum blockchain and following the ERC-20 standard, making it widely compatible with Ethereum-based wallets and dApps. - **Open-source software**: Released under the GNU Affero General Public License, allowing for community contributions and modifications. - **Widespread adoption**: Supported by major DeFi platforms, demonstrating its utility in decentralized finance applications. ## Body ### Overview Dai is a decentralized stablecoin issued by MakerDAO, a decentralized autonomous organization (DAO) operating on the Ethereum blockchain. Launched on December 18, 2017, Dai aims to provide a stable value store and medium of exchange within the decentralized financial ecosystem. ### Technical Details Dai operates as an ERC-20 token on the Ethereum blockchain, adhering to the Ethereum Request for Comments (ERC) standard. The token is managed by MakerDAO, which governs the issuance and redemption of Dai through smart contracts. The system relies on collateralized debt positions (CDPs) to maintain the 1:1 peg to the US dollar, ensuring stability. ### Development and Versions MakerDAO has released multiple versions of the Dai system, with updates addressing bugs, security improvements, and feature enhancements. The versions range from 0.2.1 to 0.2.10, released between March and July 2019. Each version includes updates to the smart contracts and underlying codebase, reflecting the ongoing development and refinement of the Dai system. ### Governance and Community Dai is governed by MakerDAO, a decentralized autonomous organization (DAO) that operates without central control. The DAO is composed of MKR token holders, who vote on proposals and decisions affecting the Dai system. This decentralized governance model ensures transparency and community-driven decision-making. ### Use Cases Dai is widely used as a stable value store and medium of exchange in decentralized finance (DeFi) applications. It is supported by various DeFi platforms, including lending, borrowing, and trading protocols, facilitating stable and efficient financial transactions within the decentralized ecosystem. ### Legal and Licensing Dai is copyrighted and released under the GNU Affero General Public License, version 3.0 or later. This license allows for the free use, modification, and distribution of the software, promoting open-source collaboration and innovation. The source code is hosted on GitHub, enabling community contributions and transparency.