Crypto Academy Week 4 Homework Post for @gbenga: Ethereum Blockchain Explain. by @akahhassan

stable coins stable coins are just as the name implies they are a cryptocurrency that has stability as their primary feature they are pegged to the value of another asset and will hold the same value with that asset through time stable coins can be pegged to any assets commodities a price index a real asset and even other crypto however they are mostly pegged to fiat currencies like the US dollar or the British Pound etc so when you say that a stable coin is pegged to the u.s. dollar it means that one unit of that crypto will always be equal to one US dollar one dai should always be worth one US dollar

maker is a decentralized autonomous organization or Dow that was built on the etherium block chain maker is trying to develop a line of decentralized stable coins that will be tied to other assets they've issued to tokens namely the maker MKR and the dai stable coin both of which are ERC 20 standard

maker holders are essentially in charge of the risk management of the dai eco system they can take important decisions that relate to dai issuance risk parameters target rates global settlement decisions and much more

1 utility token

2 governance token

3 resource for Recapitalisation

1 utility token only MKR can be used to pay fees on CDP's within the maker system when the fees are paid the nkr is removed from the total supply or burned as MKR is burned the supply will decrease if the demand for CPD's and dai goes up the demand for MKR will also go Up

2 governance token  MKR is used as a governance token holders use their MK art to vote for the logistics and risk management pieces of the maker platform the maker voting process goes through a process called continuous approval voting with continuous approval voting users holding mkr can vote for certain proposals using the MK r they hold anyone holding MK r can also create and submit new proposals if they so choose voters have the choice of casting votes or withdrawing their votes for any given proposal at any time the proposal which receives the most votes is considered the top proposal and can then be implemented into the maker system

3 resource for Recapitalisation MKR is viewed as a recapitalisation resource if certain pieces of the collateral portfolio don't meet the collateralization it needs then the maker system will automatically create and sell MK r tokens doing so immediately raises capital to meet the shortfall of value within the maker system as a result the entire system is no longer insolvent having this type of feature on the maker platform creates a system that should align voter interest with the interests of the system itself

emergency shutdown feature previously known as global settlement emergency shutdown will stop and settle the maker protocol to ensure that everyone on the platform both CDP holders and die holders receive the value of the assets to which they're entitled essentially it allows dai holders to redeem their dai for collateral in the event of an emergency shutdown where are the chances of such a situation arising our low emergency shutdown is in place as a last resort so that the maker system is protected against a serious threat

 I think about it well honestly it is it does have strong potential to make a dent in the stable coin market dai has the tremendous undertaking of overthrowing tether as the stable coin but I believe the technology behind it makes this a real possibility one of the key advantages of MKR is that it has a viable product in dai and offers a transparent system that does a fantastic job of connecting the investor token to the product itself

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