On May 23rd, the San Francisco-based U.S. cryptocurrency exchange giant announced it was listing Dai on its main website, Coinbase.com, as well as on its Android and iOS mobile apps.
The development is a major one for the stablecoin, whose community had previously lacked a major fiat on-ramp.
Indeed, now users who want to pay down their CDPs or simply hunker value away from other crytpocurrencies’ volatility prices can purchase Dai directly with cash on Coinbase’s most popular platforms instead of having to first buy another crypto, e.g. ether (ETH), to trade into Dai.
DAI is now live at https://t.co/wHvnDs40HG and in the Coinbase iOS and Android apps. Coinbase customers can log in now to buy, sell, convert, send, receive, or store DAI.
— Coinbase ????️???? (@coinbase) May 23, 2019
Notably, Dai trading had already been launched for select jurisdictions on Coinbase’s advanced trading arm, Coinbase Pro, in December 2018. Thursday’s release represents the unfurling of support for the token throughout the exchange’s entire brand.
It will be the first stablecoin project anywhere in Coinbase’s ecosystem that isn’t underpinned by U.S. dollars custodied in physical bank accounts, e.g. USD Coin (USDC).
Instead, the Dai’s dollar-pegged tokens are created when users’ collateralize ether (ETH) for self-lending in MakerDAO’s collateralized debt positions (CDP). In kind, Dai are burned whenever CDPs are paid off and closed out.
In recent months, the Dai has traded slightly below its $1 USD peg, which has led the Maker community to acutely hike up CDP interest rates as high as 19.5 percent to try to return that peg by nudging users to close their CDPs, burning Dai in the process.
The campaign has seemingly proved successful as of this month, as the Dai’s current price has since returned to a clean $1.00 according to Coinbase’s new portal page for the token. Moving forward, Maker’s stakeholders are considering raising the Dai’s interest rate to “within a range of 13.50% to 23.50%“, per the project’s blog.
DeFi News: Compound v2 Goes Live, Coinbase Wallet Supports
Compound — presently the second-largest DeFi project in the whole cryptoeconomy — also had some big news on May 23rd, when it successfully launched v2 of its lending protocol.
Today, we’re thrilled to announce the public launch of Compound v2, an interest rate protocol intended to power the financial markets & applications of the future.https://t.co/OyT7CVWieD
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— Compound Labs (@compoundfinance) May 23, 2019
The updated Compound has introduced cTokens, which are tokenized versions of assets that users put up to supply liquidity for the platform. cTokens accrue interest for their holders and can be moved around even as their underlying assets are locked up. Supported cryptocurrencies for now include ether, Dai, USDC, 0x (ZRX), Augur (REP), and Basic Attention Token (BAT).
Coinbase’s decentralized app (dapp) browser Coinbase Wallet was among the several projects that implemented support for Compound v2 and its cTokens at launch.
Big shoutout to the @CoinbaseWallet team for supporting cTokens on launch day today! Go try it for yourself and mint a cToken by supplying an asset to @compoundfinance via @CoinbaseWallet pic.twitter.com/a04x3oJUeH
— JSON (@jaysonhobby) May 23, 2019
The Specter of DeFi Continues to Rise Throughout Cryptocurrency Space
May 2019 has proven to be the biggest month yet for the DeFi movement, as it was earlier this month that the worth of outstanding loans spawned by the Ethereum blockchain’s top decentralized lending projects crossed the $100 million valuation mark for the first time ever.
Overall, the four biggest DeFi projects at present as measured by tracker site DeFi Pulse are Maker, Compound, Dharma, and Uniswap. The first of those three are cryptocurrency lending plays, all of which are built atop Ethereum. In fourth comes Uniswap, an increasingly popular decentralized exchange (DEX).
The juggernaut of that bunch to date has been Maker. The amount of ether locked up in the project’s CDPs — a sum worth in excess of $430 million — far outpaces the $23 million worth of ETH locked up in Maker’s nearest competitor, Compound.
Of course, amid the game of coins, these standings are sure fluctuate in the years ahead. But one thing is clear — the top two DeFi projects are set to become that much more entrenched due to increased support from Coinbase.