Two of the most popular coins pegged to the US dollar are USDT and USDC. Yet a lot of crypto traders prefer more decentralized solutions in the form of DAI. But is it the right choice for dollar-storing and buying assets like Litecoin?
Find the answer below!
DAI to USD: is it stable?
DAI is the world’s first decentralized stablecoin issued on the MakerDAO platform. DAI operates on the Ethereum network (ERC20), and its rate is not subject to volatility, unlike most cryptocurrencies: 1 DAI is always equal to $1.
As you can see, on the chart provided by letizo.com the DAI rate was very unstable and made big jumps, the largest of them being almost +30%. But now everything has stabilized, as work on the project is being actively carried out. Also every day we can find positive DAI coin news.
Unlike USDT and other crypto dollars, DAI is backed by the digital currency rather than fiat. These can be Ethereum coins or any tokens on its blockchain, such as WBTC, LINK, MANA, and so on.
The user can pledge their cryptocurrency and receive as many DAI as they choose – that is, roughly speaking, exchange cryptocurrency for a stablecoin in an arbitrary ratio.
Of course, you can just buy USDT, USDC, or BUSD, but it will be less safe, since these cryptocurrencies, although protected from volatility, are centralized – that is, hypothetically, the controlling body can manipulate them in their favor. As we mentioned above, DAI is a decentralized stablecoin, and this is not possible here.
Should I invest my DAI in LTC?
On May 10, 2021, Litecoin once again became one of the growth leaders among the largest cryptocurrencies in terms of capitalization, having risen in price to $$412.96. Then we recorded Litecoin’s ATH. The capitalization of altcoin reached $23 billion, which allowed it to take the sixth line in the list of the largest digital coins, ahead of Bitcoin Cash.
However, the Litecoin live price chart shows a sharp decline. Hence it may serve as a great investment point.
Litecoin is on the shortlist for large investors, so most of the positive Bitcoin agenda quickly spreads to LTC. Here in crypto, we used to think the following:
- Bitcoin is “digital gold”;
- Litecoin – “digital silver”.
The growth of Litecoin is affected by the same set of news, including the addition of PayPal and the general growth of the crypto market.
Many Litecoin price prediction platforms are confident that the asset will continue to copy the movements of its older brother – Bitcoin.
So why not exchange some DAI in favor of LTC?