The Dia stablecoin was created to address the massive market fluctuation problem within the cryptocurrency community. While other coins are prone to jumping and falling in value rapidly depending on the time of day, Dai’s coin is pegged in value to the US Dollar. This means that, no matter what happens within the rest of the market, Dai will always have an exchange rate of one coin per USD $1.
— Swarm Fund (@TheSwarmFund) July 25, 2018
The application of the coin may not always be direct. Traders looking to make a profit buying and selling cryptos may look at this currency as a waste of time; its value never changes. However, the coin can be used to lock in prices by providing a consistent, unchanging tether to which investments can be linked. In a recent announcement, the creators of Dia token outlined that a new partnership with MakerDAO will allow investors to lock in their investment prices as soon as they commit to an investment.
Swarm Investment Platform
Swarm’s investment platform has already provided investors with a successful way to lock-in investment prices following commitment to a cryptocurrency contract. The process works by exchanging cryptocurrencies or fiat dollars to Swarm’s unique SUN tokens, which are also pegged to the US Dollar. These tokens are then converted to unique security tokens, the type depending on the transaction being conducted. This provides token holders with a token version of the actual assets backing up their investment.
This process is set to remain the same under the new model with Dia, but will use the Dia token instead of SUN to peg the investments to a consistent value with the United States Dollar. Swarm’s co-founder has actually outlined his interest in Dia, saying that the coin is everything that they wanted their SUN coin to be, “and more.” Working with Maker DAO, the company has already been able to create a “clear backing structure” for the Dai stablecoin to experience further adoption and consistent usage in the securities market.
Swarm is able to turn investment opportunities typically only available to select corporations available to anyone on the Swarm network. They do this by converting larger investments into manageable-sized blocks that their customers can participate in.
Another major aspect of the Swarm platform is their ability to provide companies with a platform upon which they can create their own cryptocurrency-based companies, enterprises, and technologies. The integration of the Dai coin into the existing framework should help to up investor faith and interest in the already-growing platform by addressing key concerns regarding instability in the cryptocurrency market.
The two companies are both deeply interested in creating a set of circumstances that maximize investor interest and faith in the cryptocurrency market by locking in prices and minimizing the risk associated with investing in this crazily volatile market.
As the partnership enters the implementation phase, all eyes will be on the Swarm market to see how the USD-tethered Dai stablecoin will help to innovate the price-locking technology already native to the Swarm framework.