DAI vs. USDT/USDC: How MakerDAO’s Decentralized Stablecoin Stands Out in DeFi

Stablecoins is a vital bridge between traditional financing and encrypted currencies, providing price stability in the volatile Blockchain world. Among them, Dai, created by Makerdao, is unique for its decentralized approach, distinguishing it from central Stablecoins such as USDT (Tether) and USDC (Circle).

What is Makerdao and Dai in simple phrases?

Makerdao is a decentralized platform on the Ethereum Blockchain collection that allows users to create and manage Dai, which is Stablecoin designed to stay at a value of $ 1. MKR TOKEN, which was created to launch Makerdao to supply about a million coins, enables the owners to judge the platform by voting on the main decisions. Unlike the traditional funds issued by banks, Dai is created through smart contracts, or a self -executing code that is automatically operated on Blockchain.

Here’s how Dai:

• Users deposit cryptocurrencies such as ETHEREUM (ETH) in a maker’s cellar, or a smart contract designed to store the cryptocurrency used as a guarantee.
• The guarantee should be more than the Dai -created to maintain the system.
• If the value of the guarantee decreases, the system may sell it automatically to keep the PEG price for $ 1.
• MKR Makerdao holders are governed, as they vote on bases such as interest rates or acceptable guarantees.

This preparation eliminates the need for a central authority, which makes Dai a real currency driven by society. This is unlike the main central stablecoins, USDT and USDC, which depends on companies to manage their support.

Davi in Davi

Defi financing refers to Blockchain financial applications that work without banks or intermediaries, enabling lending, borrowing and circulation over smart contracts. Dai is the cornerstone of Defi because it is a stable and uncontricular currency that is widely used via DEFI platforms such as AAVE or Compound, where you can lend or borrow metal currencies against Dai or use them as an essential currency in stock exchanges or to participate in liquidity pools to the earN rewards.

The unreliable Dai nature is in line with Div’s goal of open financing without permission, unlike USDT or USDC, which faces organizational and exported risks.

How Dai differs from other stablecoins

While all Stablecoins aims to maintain a stable value of $ 1, the Dai’s decentralized design contrasts with USDT and USDCs. Here are some major practical differences:

1. Decentralization against centralization

• Dai: No centralized, managed by smart contracts and is governed by the distinguished code holders. One company does not control Dai, so it cannot be frozen or seized by the central authority. For example, in a country with strict encryption laws, you can use Dai without fear of the source that blocks your wallet.
• Usdt/USDCTether and Circle, respectively. These companies carry reserves and can freeze accounts. For example, if USDC informs your account with potential illegal activity, your money can be closed.

Practical effect: Dai is suitable for Defi users who appreciate privacy and independence, but they require a wallet like metamask and some technology know how. Usdt/USDC is easier for beginners, as it is widely available in central exchanges such as Binance.

2. Support and guarantee

• Dai: Supported from encryption assets such as ETH, which is locked in a maker’s cellar. You need to deposit more guarantees from the Dai in which you are, and watch it to avoid liquidation. For example, you can lock 1 ETH (let’s say $ 3500) to Mint 2000 Dai. If the ETH price decreases to $ 2000, your Qabout may be filtered to cover Dai.
• Usdt/USDC: With the support of FIAT Reserves (cash, bonds) that Tether/Circle requires confidence in the sheet and its reviews. For example, you can buy 1000 USDC on Coinbase with a bank transfer to the US dollar with no necessary management.

Practical effectDai allows you to create a stable value of Crypto without selling by allowing you to keep your ETH while receiving the Dai coin in return. Usdt/USDC is simpler for trading or payments but depends on the financial health of the source.

3. Stability and risks

• DaiMaintains PEG $ 1 through guarantee and stability fees (the benefits that VAULT users pay). It is strong, but the price can differ in the maximum markets. For example, the collapse of the market can liquidate your Qabout if the guarantee decreases very quickly, but the price of Dai Peg usually recovers.
• Usdt/USDC: Tightly bound to $ 1 through the Fiat reserves, with rare deviations. The risks include insolvency or organizational prohibition. For example, if the Tether Missances reserves, USDT may lose its value.

Practical effectDai’s PEG reliable for Defi, but it is more dangerous in volatile markets. Usdt/USDC provides more strict stability for daily use but depends on the source confidence.

4. Use cases and easy access

• Dai: A stable, ideal currency for lending, borrowing or returning to agriculture, as users occupy the cryptocurrency to provide liquidity in Defi applications for bonuses. It requires wallet gas fees and ethereum.
• Usdt/USDC: Dominates the central exchanges of trading and payments, with support on multiple groups such as Solana and Tron with low fees.

Practical effectDai is perfect for Defi strategies, but it is less suitable for use. Usdt/USDC is better for fast trade or non -Defi uses because of its simplicity and wide acceptance.

5. Governance

• Dai: The society governed by MKR holders, who vote on the protocol changes, which makes it adaptable but slower in modernization. For example, MKR holders may vote to add new guarantees such as Sol and expand the use of Dai.
• Usdt/USDCTether/Circle, which provides quick decisions, but there is no introduction to the user. For example, Circle can add a USDC to a new Blockchain overnight, but users have no opinion.

Practical effectDai offers a voice for MKR holders, and is in line with the DEFI societal structure. Usdt/USDC both giving priority for decentralization efficiency.

Comparison

feature	Makerdao – Decentralization)	Usdt/USDC (central)
He writes	Decentralization, backed by encryption	Central, supported
How to gain	Mint via cellar or purchase on Dexs	Buy on stock exchanges
Basic use	Divi loan, borrowing, return on agriculture	Trading, payments
Risk	Liquidation, gas fees and contract imbalance	Virtual source, black list
stability	Strong fluctuation, slight in accidents	Very stable, depends on confidence
accessibility	Knowledge requires a portfolio/Devi	Beginners are friendly
Ruling	Society through MKR code	The company controls

neverTry to switch ETH for Dai on Uiswap or explore Makerdao to Mint Dai. Start the small and research risks to move with confidence.

Disclosure: Crypting currencies and Defi involve risks; Always do your own search.