Market
Problem that it solves
DAI solves the problem of the need for a stable digital currency but without the downside of centralization.
Customers
Anyone looking to use a dollar-pegged, blockchain-powered digital currency can use Dai. Currently, Dai is mainly used by digital asset traders and users of decentralized finance (DeFi) applications on the Ethereum blockchain.
Value creation
Price stability is something that has been missing in the digital currency market for a long time. With DAI, anyone can hold funds or transact in a stable, dollar-pegged digital currency. In addition, DAI is a relatively decentralized alternative to centralized stablecoins, such as Tether or USD Coin.
Market structure
Currently, DAI is being used mainly by traders and DeFi users. However, businesses and merchants could also adopt this coin in the future.
Market size
The potential market for DAI is impressive because it is a useable, decentralized stablecoin.
Regulatory risks
DAI could easily attract the wrong kind of attention from regulators as it provides a decentralized, crypto-backed alternative to centralized, regulated stablecoin offerings.
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Competitive Advantage
Technology/blockchain platform
DAI operates on the tried-and-tested Ethereum blockchain.
Lead time advantage
DAI's lead time advantage was relatively small in the stablecoin market. However, it is clearly number one among decentralized, algorithmic stablecoins. Hence, it has consistently remained near the front of the pack of stablecoins.
Contacts and networks
MakerDAO's Rune Christensen is well-connected in the industry and has access to a wide range of industry players.
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Management Team
Entrepreneurial Team
DAI is fueled by MakerDAO, which is 'managed' by Rune Christensen. Under Rune's watch, DAI has flourished.
Industry/technical experience
The team has more than enough experience in the industry, but most of their credentials stem from DAI.
Integrity
Mr. Christensen comes across as transparent and honest. He has publicly expressed his desire to distance himself from the management of the project and aims to decentralized the MakerDAO entirely.
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Token Mechanics
Token required
The DAI token is necessary in order for it to be transferrable in the market.
Value added
DAI's token adds new value in the stablecoin market because of its decentralized aspect. However, you could argue that users who want to hold a dollar-pegged stablecoin could just use a more established, centralized competitor.
Decentralized
DAI is fairly well decentralized, but the interest rate is controlled by its voters. When the value fluctuates in response to market conditions, it feels a lot like a centralized asset.
Token supply
The token supply is flexible, but it has to be in order to maintain solvency as a pegged asset.
Public exchange
DAI is available on many leading exchanges.
MVP
DAI has been up and running since 2017.
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User Adoption
Technical difficulty
As an algorithmic, crypto-backed stable digital currency, DAI is substantially more difficult to understand than its centralized counterparts.
Halo Effect
DAI's halo effect stems predominantly from its strong association with Ethereum.
Buzz
People are talking about DAI, and social media follows the decisions of the MakerDAO community closely. Especially the Ethereum community.
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Overall Score
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