MakerDAO is a Decentralized Finance (DeFi) project that offers a crypto-collateralized, stablecoin DAI that is associated with the US dollar. The coin is managed by its community via a Decentralized Autonomous Organization (DAO). DAI is generated by users locking cryptocurrency in a Maker Vault at a certain Liquidation Ratio.
To account for the volatile nature of cryptocurrency values, the stablecoin is overcollateralized, and a Stability Fee is also charged. If collateral falls below the Liquidation Ratio, the crypto is liquidated and used to repay individual losses.
DAI maintains its stability because its DAO regulates the Stability Fee and the Dai Savings Rate. The Stability Fee changes the cost of minting DAI, which impacts its availability. The DAI Savings Rate influences coin demand, affecting investors’ returns on DAI staking. When DAI deviates from its peg, the DAO employs these two procedures to restore it.
 project that offers a crypto-collateralized, stablecoin DAI that is associated with the US dollar.){kind=link}