Dai is a stablecoin designed to trade as closely to $1 as possible. Unlike most other stablecoins, Dai is collateralized exclusively by other crypto assets. This is facilitated through the Maker protocol on the Ethereum blockchain, where crypto assets like ETH, BAT and USDC can be locked as collateral in order to borrow DAI tokens. The Maker protocol and the Dai stablecoin play a big role in Ethereum's decentralized finance (DeFi) ecosystem.  Users who hold DAI tokens can earn some passive income through the Dai Savings Rate mechanism that's implemented in the Maker protocol. The Maker protocol is governed through the MakerDAO decentralized autonomous organization that consists of holders of the MKR governance token.