Maker — or MKR — is the governance token of the DAI stablecoin. Both of these assets are issued by MakerDAO, the first decentralized finance project to achieve widespread usage. More importantly, it is the tool by which DAI is pegged on a one-to-one basis with the U.S. dollar. Users deposit ETH or other cryptocurrencies — including USDC, LINK and WBTC — as collateral in order to borrow DAI stablecoins. As a result, borrowers can monetize their cryptocurrency holdings without selling them. The process is automated by smart contracts, with borrowers depositing crypto worth up to 200% of the amount they wish to borrow. DAI is created at this point and burned when the loan — technically a collateralized debt position — is repaid. Unlike traditional stablecoins, such as USDT or USDC, DAI is not backed by a reserve of dollars. Instead, it uses MKR, which is automatically minted or burned as necessary to keep DAI stable while the cryptocurrencies serving as collateral fluctuate in value. As a governance token, MKR gives holders the right to vote on proposals in its Continuous Approval Voting system, for which they earn rewards in MKR. In April 2021, MakerDAO voters voted to accept real-world assets — in the form of an ERC-20 token with real estate ownership rights — as collateral for a loan.