Maker Becomes Most Valuable Token as Nearly 1% of all ETH Is Locked in Dai
With a market cap of above half a billion dollars, Maker is now the most valuable Ethereum token after overtaking OmiseGo. Most of Maker’s success is attributed to its Dai stablecoin, which now has almost one percent of all ETH locked in as of October 8, 2018.
Maker Sees a 20 Percent Increase in Less Than a Month
Rising another 20 percent on increased volumes of $3 million, Maker has more than doubled in price since September 12, when it was bumping between $300 and $750.
This increase has given Maker a market cap of above half a billion dollars, making it the most valuable Ethereum-based token. Maker has reached number one after overtaking OmiseGo on October 8, a token that has long dominated the top position for ETH.
Maker overtakes OmiseGo, October 2018
According to TrustNodes, the success of Maker is mainly dependent on the success of DAI, an algorithmic stablecoin that effectively turns collateralized ether into pegged dollars. While there is a wide variety of stablecoins currently available on the market, none of them managed to stand the test of the most volatile times, such as September 12 when ether reached a low of $167.
Nearly a year since Dai launched, that resilience has increased confidence in the coin, which has now reached a market cap of just under $60 million. The algorithmic stablecoin separates itself from others on the market in that Dai is actually created through a smart contract, and it requires a certain amount of ether for the contract to be fulfilled.
Nearly one Percent of all ETH Locked in Dai
This has lead many crypto enthusiasts to consider Dai a truly decentralized stablecoin, increasing its popularity and broadening its usage. That is why around one percent or all ETH in existence today are locked in Dai. The 800,000 ETH fulfill the smart contracts needed to create the coin and ensure liquidity when it comes to Dai.
(Source: Maker DAO)
According to TrustNodes, there is now $3 worth of ETH locked for every $1 in Dai to give the peg some leverage in light of ETH’s highly volatile price. And while the general sentiment about the amount of ETH locked in Dai has been mostly positive, with investors believing that the move will help ethereum, Maker, and Dai, others have been more critical. Those who criticized the decision and believe that can hurt the price of ether.
In a September 30 Medium post, a blockchain consulting company, Deepit argued that Dai’s incredible resilience results in considerable increases in the amount of ether needed as collateral, leading to the token’s deflation and subsequently, the increase in its price.