MakerDAO price rebounds as DAI holds its peg and investors search for stablecoin security
Its been a rough couple of weeks for the cryptocurrency market. Bitcoin (BTC) price is nowhere near the price estimates of most analysts, multiple stablecoins lost their peg and the demise of one of the top decentralized finance (DeFi) platforms sparked an event that resulted in $900 billion vanishing from the total crypto market capitalization.
In the midst of the widespread fallout, MakerDAO (MKR) managed to turn crisis into opportunity and the collapse of TerraUSD (UST) has brought renewed attention to DAI, the longest-running decentralized stablecoin.
Data from Cointelegraph Markets Pro and TradingView shows that as the collapse of Terra (LUNA) price accelerated from May 9 to May 12, MKR climbed 66.2% from a low of $952 on May 12 to its current value of $1,587.
Three possible reasons for the MKR's reversal in momentum include DAI maintaining its peg during the recent market turmoil, the use of a MakerDAO vault to finance supply chain shipments and the addition of staked Ether (ETH) as a form of collateral to mint DAI.
One of the most significant factors giving investors more confidence in the MakerDAO ecosystem is the fact that DAI held its dollar peg during a shaky market that saw a handful of the most popular stablecoins lose their pegs.
Over the past few days DAI demand has violently contracted by 25%, but the peg is still rock solid due to the Peg Stability Modules.Stacking DAI demand into the PSMs during the bull market gives DAI holders peace of mind during even the roughest of weeks. pic.twitter.com/XGEYndBP05
During the height of volatility, the price of DAI oscillated from a low of $0.9961 on May 11 to a high of $1.0046 on May 12 and is currently priced at $0.9994.
DAI holding steady despite a supply decrease
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