The governance and recapitalization token of MakerDAO, the protocol behind DAI, the original decentralized stablecoin.
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Maker (MKR) is the governance and recapitalization token of MakerDAO, the protocol that issues DAI, the original decentralized over-collateralized stablecoin. MakerDAO launched in 2017; DAI has been live since December 2017 and remains one of the most important stablecoins in DeFi, particularly favored where issuer-trust matters less than collateral transparency. The protocol has been undergoing a "Endgame" transformation to subdivide governance into smaller subDAOs and rebrand to Sky.
Users open Vaults by depositing collateral (initially just ETH; now expanded to many crypto and real-world assets) and minting DAI against that collateral. The collateralization ratio must stay above a minimum (typically 130-150%) or the Vault is liquidated. Stability fees (interest charged on minted DAI) are paid in DAI; this revenue accrues to the protocol and historically has been used to buy back and burn MKR. MKR holders govern protocol parameters: which collateral types are accepted, what stability fees apply, how risk is managed.
DAI is widely used in DeFi as a stable unit of account, especially in protocols where users want to avoid issuer-trust assumptions of USDC or USDT. MKR holders are the protocol's "lender of last resort": if collateral values fall faster than liquidations can happen, MKR is minted and sold to recapitalize the protocol, diluting holders. This makes MKR a productive but risk-bearing asset.
MKR's governance token model places real risk on holders: in the March 2020 "Black Thursday" event, MKR was minted and sold to cover a shortfall after Vault liquidations failed. The Endgame restructuring has been controversial within the community, with debates over whether splitting MakerDAO into subDAOs strengthens or fragments the protocol.
See stablecoin for the asset category and DeFi for context.