MakerDAO (MKR) is considered one of the first and at the same time most popular projects in the field of decentralized finance (DeFi). The credit platform wants to enable” financial freedom without volatility ” and has been able to more than quadruple its value within the last six months with this promise. However, in the wake of the market-wide downturn, MKR also had to bounce back strongly and is currently at $ 2,492, about 60% below the all-time high of $ 6,339, which was reached on May 3. Will MakerDAO manage to return to the highs? We introduce the DeFi project and say: What is MakerDAO (MKR)? Why is MakerDAO (MKR) special? Who invented the token? And: What are the price forecasts for MakerDAO (MKR)-from 2021 to 2028?
What is MakerDAO (MKR)?
The MakerDAO lending platform was one of the first DeFi projects ever. MKR was invented back in 2015, the actual launch then took place on the Ethereum blockchain in 2017. Maker (MKR)is the governance token of the MakerDAO and Maker protocol. DAO, in turn, is an abbreviation for “Decentralized Autonomous Organization” (see below): this is a decentralized organization or software platform that allows users to issue and manage the DAI stablecoin.
DAI, on the other hand, is a community-managed decentralized cryptocurrency with a stable value pegged to the US dollar. It is not subject to wild price fluctuations, but is always worth around 1 dollar-hence the name Stablecoin. However, there may be slight deviations, because Dai is not a currency firmly tied to the US dollar. Rather, the stablecoin maintains a freely fluctuating bond that has extremely low volatility against the US dollar. Dai achieves stability through a combination of different aspects. Market participants who, on the one hand, pursue their own interests and yet work together (such as MKR holders, arbitrageurs, vault owners, keepers and market makers) contribute to this stability.
What is the MKR token?
MKR is the native ERC-20 token of the Maker protocol. It is used as a governance token and recapitalization source of the Maker protocol.
What does “DAO” mean?
DAO is an abbreviation for”Decentralized Autonomous Organization”. Related to MakerDAO: Here, not a central instance manages the Maker protocol, but a decentralized community. This is made possible by an embedded governance mechanism. The Community or “Organization” consists of all MKR token holders, community members, and ecosystem stakeholders. Only MKR holders can make changes to the system. This is then done through a vote on the blockchain. The advantage of the concept: DAOs are completely decentralized because no single party has full control of the system.
How does MakerDAO (MKR) work?
The Maker platform consists of the token Maker and DAI. These are used as follows: Users can connect their personal Ethereum wallet to the Maker platform and then deposit Ethereum there. ETH is then used as collateral to issue so-called DAI tokens.
To generate DAI, you need MKR tokens. However, these are extremely rare – there are currently only 991,328 MKR. For comparison, of Bitcoin, which is also considered rare, there are a maximum of 21 million pieces. In addition,: There will also be less and less MKR in the future. This is due to the so-called token burn program, in which MKR is continuously destroyed and thus removed from circulation. This makes MKR a deflationary token.
Why is MakerDAO (MKR) special?
MakerDAO’s DAI token is one of the most popular stablecoins. It is currently ranked 18th by market capitalization ($5,481,253,353). MKR is special because any holder can directly participate in the governance of DAI. Every Maker token holder has the right to vote on changes to the Maker protocol. The weight of the voice directly depends on the size of its MKR portion.
For example, MKR holders decide by majority vote which new types of collateral and risk parameters will be added. In addition, MKR holders are also buyers of Dai loans in the last resort. That means: If the Ethereum deposited as collateral is not sufficient to cover the corresponding Dai amount, MKR is created and sold via debt auction.
Who invented MakerDAO?
MakerDAO was founded in 2015 by Danish entrepreneur Rune Christensen. After graduating in Biochemistry from the University of Copenhagen, Christensen studied International Business at Copenhagen Business School. Prior to MakerDAO, he was co-founder and head of the international recruiting company Try China. From the very beginning, Christensen’s goal was to develop a decentralized financial system, controlled only by the community. This is intended to give borrowers more control over their assets.
What is the Maker Foundation?
The Maker Foundation is responsible for the development and dissemination of MKR. She develops strategies to make MKR permanently successful and to ensure that the coin can thrive on its own. Decentralization is therefore the Foundation’s highest priority, according to its own statement. And: The Maker Foundation is part of MakerDAO. However, the Maker protocol itself is only managed by the voting rights of the MKR token holders. The Foundation does not have a privileged position within the MKR ecosystem.
MakerDAO – what does the future hold?
The opportunity to participate in the management of one of the largest stablecoins on the market drives the demand for MKR tokens and, accordingly, affects their value. In addition, the fact that MKR is a deflationary token and is becoming increasingly rare has a positive effect on the price. It is also likely that new DeFi apps will be developed continuously, expanding the maker ecosystem and providing added value to users around the world.
In addition, Dai is pushing into the billion-dollar gaming industry. Especially for this purpose, MakerDAO has launched a gaming initiative. This is intended to promote the development of games or apps that integrate Dai rewards. So what do the MakerDAO price forecasts say?
The MakerDAO (MKR) Price Forecasts 2021 – 2028
- CoinCodex.com is generally bearish at MakerDAO: 7 technical analysis indicators give bullish signals, but 20 bearish signals are opposite.
- tradingbeasts.com is slightly pessimistic about MakerDAO compared to the rest of the forecasts: by the end of 2021, a maximum increase to $ 3,003 is predicted. Only in September 2023 MKR manages to overcome the 4.000 dollar mark. And by the end of 2024, according to the 3-year forecast, MKR will reach a price of $ 4,770 at best.
- DigitalCoinPrice.com is bullish on MakerDAO. The forecasts certify MKR a continuous upward trend: By the end of 2021, MKR will rise to $ 3,624. In the course of 2022, MKR is already cracking the $ 4,000 mark and moving to $ 4,143. This is how the rise of MKR continues in the following years: every year MKR achieves an increase of around 1,000 dollars. in 2024, MKR leaves the old all-time high behind and trades at $ 6,639. By the end of 2028, the MKR forecast predicts an increase to $ 11,478!
- Gov. Capital also predicts an increase in MakerDAO: according to it, MRK could experience a bull run that will bring the coin up to $ 5,916 by the end of 2021.
- The MKR forecast of WalletInvestor.com is more than bullish: The MKR 1-year forecast sees the MKR price initially rising to $ 6,038-just short of the all-time high, and already within the next 12 months. After that, MKR ignites the turbo: the MKR-5 annual forecast predicts an increase to $ 19,279 at MakerDAO. This represents an increase of 653%.
Last updated on July 14, 2021
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