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Dai is a fiat-pegged stablecoin launched as a ERC-20 token on the Ethereum blockchain in December 2017. A major upgrade from single-collateral Dai (SAI) to multi-collateral Dai (DAI) was completed in November 2019. Dai is pegged to the US dollar.
Dai is minted by users locking up crypto assets such as ETH or USDC as collateral in a collateralized debt position (CDP) called a vault. Previously, only ETH was accepted as collateral. The reserves and status of each vault can be viewed on the blockchain in real-time. The health of these vaults and the Dai stablecoin are closely monitored.
As of April 2023, Dai is currently the world's third-largest stablecoin with over $4.7 billion in circulation.