The lack of supply of DAIs in exchange houses, the high cost of generating some DAI, and the increase of stored DAI multiply stablecoin prices.
Traditional currencies such as the dollar are used not only to count money or make payments, but also as value guard. The last use is also evident in the world of cryptocurrencies. This is the case of DAI, a stablecoin pegged to the US dollar.
Stablecoins are digital assets similar to cryptocurrencies, but whose price is less volatile because it is linked to the price of another stable asset. DAI, for example, is linked to the US dollar, but its parity with this fiat currency is in danger.
Recent research issued on the Sanbase website shows an increasing use of DAI as a safeguard of value, that is, users use it to have money saved. 14.5 % of the total DAI supply is safe and inactive on loan platforms.
Some of these inactive DAIs would be deposited in wallets or decentralized finance platforms (DeFi), which makes researchers think that users seek to safeguard the digital asset due to its important value.
Between 5 and 7 % of all DAI moves every day in the market. However, the number of addresses that have not moved their tokens in the last 90 days has increased. This behavior helps to check the use of DAI for savings.
Becoming Similar to the US Dollar
CoinMarketCap revealed that since August 31st the price of DAI is between one and 1.01 dollars. The price variations oscillate between 1% to 3 % above the US dollar during the last month and it continues to increase.
According to the data of the study, during the last three months there is a pressure that would cause the increase in DAI prices. The increase in demand and the decrease in offers could be influencing that upward trend, according to the study.
In August, the tokens deposited on the loan platforms reached their maximum. The total figure closed at 11.3 million, which represents 14.5% of the total DAI supply in the market.
The treasury of encryption companies has also begun to use DAI as a short-term hedging method. Also, payment providers accumulate a significant number of those tokens in their wallets, according to the report.
In July, loans with DAI increased by more than 3,400 %, according to Coinbase Earn figures. But what causes the increase in the price of DAI?
Expensive Generation of New Crypto Assets
In the decentralized exchange houses (DEX) and in the centralized exchange houses (CEX) the amount of DAI deposited has fallen. It is estimated that the entire exchange platform market has about 5.1 million DAI, the lowest figure also in the last four months.
This behavior in exchange houses could be linked to low sales pressure and not a real lack of demand, the researchers note (because users do not want to sell the asset, but save it).
In addition, the lack of motivation to generate new crypto assets is due to the high cost this represents since the MakerDAO team increased the commission of stability of their contract to increase the value of DAI and that users would rather generate USDC tokens, instead of creating new DAI.
The increase in alliances and applications related to MakerDAO represents an increase in the demand and use of DAI. Therefore, the researchers reiterate that in the exchange houses the amount of DAI deposited has fallen not because there are no users demanding the asset, but because there is no offer of users selling it.
By Maria Rodriguez