Blog Borrowing What’s Maker Coin (MKR)? – Price, Origin, Future

What’s Maker Coin (MKR)? – Price, Origin, Future

date October 6, 2020 time 4 min read 370 views

The value of currencies around the world is not nearly as stable as it used to be. As a result, more and more investors are looking to digital currencies like DAI to offer greater stability. And DAI is governed by Maker coin, a crypto developed to help tie valuable assets to the Ethereum blockchain and hold the value of DAI stable. Here’s all you need to know about MKR today.

In November of 2020, MakerDAO became the first decentralized finance (DeFi) protocol to hit $1 billion in total valuation. It caused their platform coin, MKR hit new price highs spiking investor interest.

MKR coin price blew up in mid 2020 due to increased attention on DeFi and Ethereum
MKR coin price blew up in mid 2020 due to increased attention on DeFi and Ethereum (source: pixabay.com)

The rise in popularity may seem sudden, but MakerDAO had been popular in the crypto community for years. They were one of the first companies to answer the problem of inflation through blockchain tech. 

In many countries, inflation is a real problem. During an economic downturn, a living wage can suddenly lose all buying power in the face of a rapidly depreciating currency. Crypto has grown increasingly popular as a means of escape.

MakerDAO attempted to solve this problem by creating a stablecoin (a crypto tied 1:1 in value with the USD) on the Ethereum network in 2017 called DAI.

The pioneering crypto company recently shot to new heights of fame when its platform coin, MKR was released and saw a huge price jump in 2020.

What is Maker coin and why was it created?

Anyone who holds the platform coin for MakerDAO, MKR, can help govern the Maker Protocol – the smart contracts that power DAI.

Responsibilities for holders include adjusting policies for the DAI stablecoin like, choosing new collateral types accepted, and even improving the governing process. You can think of them as a collective government that does not print money.

What is Maker Coin
What is Maker Coin (source: bitcoinwiki.org)
The government has printed over $3 trillion in 2020 alone
Inflation is a real problem in many nations and, that’s why coins like DAI and MKR are getting increasingly popular (source: pxhere.com)

The reason Maker coin is so popular is because the massive success of DAI in DeFi has drastically increased the Maker coin price. The more useful DAI becomes around the world, the more valuable having a stake in its future becomes.

MakerDAO has made many innovations in crypto including being the first stablecoin to accept real world assets as backing for DAI.

As of writing: MKR is $530 per coin.

Where to get Maker coin

Maker coins can be purchased through many major online trading platforms like Coinbase and eToro. One thing to note is that Maker coin cannot be bought directly with USD. It must be purchased using cryptocurrencies like Bitcoin or Ethereum on an exchange.

Maker coins can be purchased and stored through online trading platforms
Maker coins can be purchased and stored through online trading platforms
(source: pxhere.com)

Where to store maker coin

Like any other cryptocurrency, maker coins are stored in a crypto wallet. Maker coin is an ERC20 token, meaning it is based on the Ethereum network and can be stored in all major Ethereum wallets.

There are two types of wallets: cold and hot.

Cold wallets are storage devices (think of an external hard drive) with no internet connection. Cold wallets offer more security than other storage methods, as a lack of internet connection means that hackers won’t be able to access it.

However, the storage device must be connected every time you wish to make a trade.

Hot wallets, on the other hand, can be accessed with ease. Think of it as a virtual bank account. If you want to deposit or withdraw MKR, all you need to do is make an online transfer.

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