MakerDAO is a platform that allows you to use your Ethereum tokens as collateral; this process creates dollar-pegged Dai tokens that are loaned to you. Recently, MakerDAO has been trying to keep Dai’s value stable by increasing the interest rates that users pay. Now, those interest fees are on the rise once again.

Last week, holders of MKR governance tokens voted in favor of increasing the Dai stability fee by 3%, which means that users will now pay 14.5% interest per year on debt that accrues while borrowing Dai.  This is one of many votes that have increased fees over the past few months—in the past, interest has been as low as 0.5%.

Supply and Demand

As MakerDAO has noted, Dai’s average exchange price has persistently been a few cents below the $1.00 target. The project also notes that market makers have large inventories of Dai, suggesting that demand for existing Dai is low among buyers. It also says that previous fee increases have had little impact on the price of Dai.

In theory, high…

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