$DAI
Pros:
- Decentralization: Managed by MakerDAO, ensuring no central authority controls the coin.
Cons:
Governance Risk: Relies on the decisions of MKR token holders, which can impact stability and usability.
How can you have a coin count in both pro and cons based on the ones making the decision?
Is it centralized or decentralized in the end, is there an authority or not behind it?
But I'll answer this myself, since the so-called decentralized organization actually hold US bonds, 1.2Billion of them
https://www.coindesk.com/markets/2023/06/01/makerdao-paves-way-for-additional-128b-us-treasury-purchase/
there is a licensed financial company behind it, so if those guys get in trouble the whole peg and the whole autonomous governance is down the drain.
USDT, USDC, and DAI have their own pages here on altcoin. So which stablecoin do you have?I always have USDT in my account to DCA crypto in the accumulation zone and recovery phase. Tether has become a major force in the crypto market, holding many US Treasuries bonds and trying to comply with regulations for many years to survive and grow stronger through each cycle. The collapse of Tether could cause major liquidity problems and recession in the crypto market, so I think the possibility of this happening is very low, maybe Tether is too big to fail. The US government also does not want Tether to collapse because Tether's USDT is becoming an effective tool to promote the power of the USD in the global crypto market, while attracting capital to buy government bonds.
$USDT (Tether)
Pros:
Market Dominance: High liquidity and acceptance across numerous exchanges and platforms.
Stability: Pegged to the US dollar, providing price stability.
Ease of Use: Facilitates quick and low-cost transactions between exchanges and wallets.
Cons:
Centralization: Issued and controlled by Tether Limited, raising concerns about transparency.
Regulatory Scrutiny: Faces regulatory scrutiny and legal challenges, creating uncertainty.
Audit Concerns: Ongoing concerns about the lack of comprehensive audits to verify reserve claims.
UST was a transparent solution and hope for the community, but LUNA spoiled it hard.
[img geight=200]https://talkimg.com/images/2024/05/30/L5CuI.png[/img]
Have a look at the reserves of the USDT. it's really disappointing that there is no other solution except for direct P2P of crypto with local currency, DAI is still exists but it lacks the acceptability on maximum platforms.
why are we made to believe DAI is decentralized when there is a team managing it such as MakerDAO?People said DAI is decentralized because the wallet developers can not freeze anyone's DAI. Unlike how Tether Limited and Circle are freezing USDT and USDC from noncustodial wallet. It was said that DAI can not be frozen but I do not know how true it is.
USDT and USDC is not very different. except USDC is ranked lower but generally works the same way, if you are not going to mind all the troubles in moving them around to some unknown networks. but it makes it safer and easier to trade with stablecoins.
USDT, USDC, and DAI have their own pages here on altcoin. So which stablecoin do you have?It is very safe to hold stable coins, because if you keep money here, the value of the money is stable relative to the dollar. So there is no fear of loss. But if you remember the crash of UST, you are afraid to keep money in stable coins. But till now USDT, USDC are in very good position and investors and traders are depositing large amount of money in them. I myself use these two stable coins. I think these two are the most trusted stablecoins out of all other stablecoins. USDT is my first choice as stable coin
- Here in our country, there is an agency of our government that seems to want to adopt usdt for our pensioners here, this is quite a good implementation that the agency will do in terms of adoption of crypto. It's not even clear to me if from the exchange it is possible to directly make a contribution for the future pension using usdt.Why would a government agency want to do that? USDT is not the dollar, but rather tokens in exchange for promises to obtain the value of one dollar, but there is nothing to guarantee those promises.
USDT, USDC, and DAI have their own pages here on altcoin. So which stablecoin do you have?
Here are some pros and cons - are there more?
$DAI
Pros:
- Decentralization: Managed by MakerDAO, ensuring no central authority controls the coin.
- Collateral Backing: Backed by a variety of cryptocurrencies, enhancing stability and reliability.
- Dai Savings Rate (DSR): Users can earn interest by locking their DAI in the DSR contract.
Cons:
Complexity: Mechanisms involving collateralized debt positions (CDPs) and smart contracts can be complex for new users.
Volatility Risk of Collateral: Backed by volatile cryptocurrencies, which can affect DAI’s stability during extreme market fluctuations.
Governance Risk: Relies on the decisions of MKR token holders, which can impact stability and usability.
$USDT (Tether)
Pros:
Market Dominance: High liquidity and acceptance across numerous exchanges and platforms.
Stability: Pegged to the US dollar, providing price stability.
Ease of Use: Facilitates quick and low-cost transactions between exchanges and wallets.
Cons:
Centralization: Issued and controlled by Tether Limited, raising concerns about transparency.
Regulatory Scrutiny: Faces regulatory scrutiny and legal challenges, creating uncertainty.
Audit Concerns: Ongoing concerns about the lack of comprehensive audits to verify reserve claims.
$USDC
Pros:
Transparency: Issued by regulated financial institutions with regular attestations of reserves.
Stability: Fully backed by the US dollar and audited monthly.
Regulatory Compliance: Operates under strict regulatory standards, enhancing trust among users.
Cons:
Centralization: Issued by a consortium (Centre) and controlled by regulated entities, leading to centralization concerns.
Regulatory Risk: Subject to regulatory changes that could impact its operations.
Limited Use Cases: Primarily used for trading and transfers, with fewer DeFi applications compared to DAI.