xDai Review : 3 Unique Tokens Model, xDai Stake, Pros, Cons

Amongst cryptocurrencies, stablecoins are without a doubt, the ideal type designed to efficiently reduce the volatility of crypto prices. These coins have values pegged to another stable asset. One such well-known stablecoin, Dai, allows users to carry out transactions with one Dai approximately equivalent to one US dollar. But gaining popularity as a better alternative is the derivative of Dai, also known as xDai. Outlined in this article is a detailed account on what xDai is in the cryptocurrency dimension — how xDai is obtained and used, read ahead to find out everything relevant.

 

What Is xDai?

Located on the Ethereum platform, xDai is a stablecoin with users from all across the world, inclusive of experienced crypto-users and first-time users. On the Ethereum-based sidechain under the name “xDai chain”, xDai is also the native stable currency used for everyday dealings at a low transaction fee yet high transaction speed. This chain was the first blockchain to have a USD-stable native currency, connecting POA Networks’ interoperability with MakerDAO’s Dai, and has grown to be highly recommended by many crypto-users.

Primarily created to enable stable payments, the xDai chain ensures that users are not subject to the unpredictable prices normally seen on Ethereum. Unlike previously seen payments in the ecosystem, xDai offers non-volatile fees that can be paid with a single token. The chain features five second block times and a bridge that directly connects to Ethereum through which users can transfer Dai (stable asset).

 

Who Is The Founder Of xDai?

Live since late 2018, xDai was founded by Igor Barinov, and was launched via POA Network (Proof of Authority – a consensus method that focuses on Ethereum transaction speed and costs). The very same creator has invented various recognised Ethereum features, such as the TokenBridge which allows for interoperability between different blockchains.

 

xDai Investors — xDai Crunchbase

xDai is funded by four major crypto venture capitalists,, as evident on the Crunchbase (leading platform for company insights) profile summary. They are namely – Bixin, Bitmax, and the two latest investors, NGC Ventures and Focus Labs. xDai raises money by seed funding, having raised up to $500k USD by mid 2019.

 

Is xDai Safe?

As every blockchain may have risks, users are requested to be cautious at all times. But xDai has proven to be a secure sidechain, especially thanks to its native stable coin choice; with the native coin being a stable token, currencies are more predictable and free of volatility risks.

Furthermore, xDai implements a multi-chain staking token (the xDai STAKE), which will be used by a number of validators to secure the chain. This gives xDai users the opportunity to partake in chain consensus as a validator or as a delegator, earning STAKE and xDai as rewards in return.

Since xDai is an independent network etched into the Ethereum environment as a sidechain, it enables secure and stable transactions that take place on a neutral network.

As stated by the official xDai team, several features on the chain have undergone comprehensive examinations by third party security firms, so as to tighten security and further build user trust.

 

What Makes xDai Unique?

xDai stands different from other common cryptocurrencies with its varied, unique features.

  • xDai is an independent network, meaning users are provided a neutral network free of not just volatility, but security concerns as well – stable transactions can be carried out at a fast speed.
  • The bridge provided to connect to Ethereum Mainnet is a great opportunity for two-way asset transfers between two chains. Dai can be bridged to xDai, and vice versa.
  • xDai’s unique multi-chain staking token (STAKE) is usable by additional sidechains, making xDai STAKE the first multi-chain enabled staking token.

In addition to these simple yet intriguing features that set xDai apart from other existing crypto, xDai provides true on-chain randomness for validators, easily eliminating the need for a third party application or service.

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xDai’s 3 Token Model: An Innovative Feature

Adding to its uniqueness comes the 3 token model in use in the xDai chain. The chain utilizes Dai, xDai, as well as STAKE to fulfill various vital functions on the chain. Dai is used as a stable asset that can be exchanged for xDai, xDai is used for day-to-day transactions, whereas STAKE is mainly used to promote security in the network.

 

Is xDai A Good Investment?

With the launch of xDai, users in the crypto-community have earned the chance to experience fast transactions at an inexpensive fee, which to most members, is a perfect deal. Instantaneous transactions that do not unnecessarily blow your wallets can only be possible with xDai.

Using the xDai token, developers can also use smart contracts but with cheaper costs and a much faster processing rate.

 

What Is xDai STAKE?

Based on ERC677, xDai STAKE is known to be the first ever multi-chain staking token. It is a governance token within the xDai dual-token structure, where the stablecoin counterpart is simply referred to as xDai. STAKE is majorly used for chain security and unlike xDai, STAKE is volatile and may fluctuate in proportion to the marketplace.

 

How Does xDai Work?

Initially, a user must have Dai or STAKE on the Ethereum mainnet that can be bridged to the xDai chain to create xDai. When Dai is locked in a contract, an equal amount of xDai is provided to the users, which can be used on the xDai chain. This xDai can then be used for various transactions at an inexpensive fee and insanely fast speed. Similarly, the exact amount of Dai is unlocked and released back to the Ethereum mainnet when xDai is burned.

 

 xDai Exchange

On platforms like Uniswap, HBTC, Hoo, Coinone or Honeyswap, currencies can be exchanged to obtain xDai tokens. USDC can be traded for xDai on Honeyswap,

 

xDai Governance

xDai features open governance and open access, granting a trusted space for both users and dApps developed on xDai. Governance refers to validator selection, where candidates can be voted for by delegating STAKES. When a candidate receives a high number of STAKES (or votes), they have an increased chance of being a validator in the next staking round.

 

xDai Staking Token STAKE

STAKE is necessary in the xDai network to guarantee the chain is protected. The POSDAO (Proof-of-Stake algorithm as a Decentralised Autonomous Organisation) protocol rewards honest validators with STAKE, and punishes rule-breakers by burning or freezing their existing STAKE. The purpose for xDai’s governance token STAKE is for proof of stake security and validation selection, focused on protecting the xDai chain.

 

Where Can I Buy xDai (STAKE) Tokens?

xDai is not normally bought directly. First, Dai must be purchased on the Ethereum Mainnet. This can be done by exchanging fiat money for Dai. Then, using the TokenBridge that connects to the chain, xDai can be obtained in exchange for Dai.

As an alternative, Coinbase can be used to exchange fiat (USD) for Dai. For new users, register with a new Coinbase account with real information so as to verify your identity. By transferring Dai to the Dex Wallet (Mobile application), it can easily be exchanged for xDai.

STAKE is available on Ethereum as well as the xDai platform. To acquire STAKE on Ethereum:

  • Centralized Exchange (CEX) on BitMax, Poloniex or Bilaxy allow users to deposit or obtain STAKE tokens.
  • Decentralized Exchanges (DEX) on Uniswap, Balancer Pool or IDEX enable users to get STAKE tokens by exchange.

To acquire STAKE on xDai:

  • Using the Bridge (OmniBridge), STAKE can be transferred from Ethereum to xDai,
  • Alternatively, Honeyswap can be used to obtain STAKE directly on xDai.

 

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xDai vs Dai

What is Dai? A well-known stablecoin created by the decentralised organisation MakerDAO, Dai is an ERC20 token on the Ethereum ecosystem, tied to the steady value of $1. Meanwhile, its derivative xDai (the native stablecoin of the xDai chain) is created by locking Dai. One xDai token is pegged to one Dai token on the Ethereum mainnet.

Both MakerDAO and the xDai Chain make use of a dual-token system; where Dai & xDai are stablecoins respectively, and MKR & STAKE are governance tokens that may fluctuate. On the mainnet, users must pay Ether and Dai for transactions, whereas this is not necessary for xDai (one-token transactions).

The key differences between Dai and xDai lie in transaction speed and cost. The table below portrays the distinctions these two share.

Token  Transaction speed Transaction cost
Dai Approx. 1 – 3 mins $0.15
xDai 5 seconds $0.000021

 

The reason Dai is much slower and pricier is because it is on the main Ethereum layer 1 network, where speed and gas fees are volatile and can fluctuate to extremes unpredictably.

 

xDai Wallet

There is a list of wallets that support the xDai system, but the most common one is the Burner Wallet. The Burner Wallet is already of good familiarity to advanced crypto users, and is very easy to understand by new members. With these user-friendly, easy to access wallets that have simple designs, it is convenient to store tokens, interact with smart contracts and buy or sell assets. Other wallets that xDai is compatible with include:

  • DEX Wallet (Mobile iOS wallet) – An Ethereum based wallet in essence, this wallet enables users to interact with DeFi protocols (Compound Finance, makerDAO, etc).
  • Alpha Wallet (Mobile wallet – iOS, Android) – This wallet has a dApp browser as well.
  • Status Wallet (Mobile messenger and wallet app) – With a built-in chat feature, this mobile Ethereum OS allows users to access dApps and carry out easy transactions with xDai.
  • Torus Wallet (Multi-chain web wallet) – A flexible, easy-to-use blockchain wallet with easy social login system.
  • MetaMask (web3wallet – Extensions) – The original web3wallet for Ethereum dApps, this can be accessed on a web browser and is now compatible to store xDai STAKE.
  • Nifty Wallet (web3wallet – Chrome extension) – This Chrome extension is the native wallet for xDai, which is easy to use and compatible with Ethereum.
  • Saturn Wallet (web3Wallet – Extensions) – The functional web extension wallet used to access Ethereum dApps can store xDai efficiently.
  • Burner Wallet 2 (Web wallet)
  • Portis Wallet (Web wallet) – With a simple “Email and password” registration, this wallet can be accessed through a web browser without any third party installations or extensions.
  • Poketto Cash (Mobile wallet) – Easy access mobile application wallet.

Some of these wallets (like Alpha and Portis) offer advanced features for advanced crypto-users. Apart from these, there is a crypto wallet called ParJar, which is meant for Telegram. As of now, it does not support xDai, but STAKE is supported.

 

How To Stake xDai Token?

To join the Easy Staking program, one of two approaches can be followed.

  1. Visit the official dashboard and connect your web3wallet (like MetaMask). Then, simply initiate a transaction and you have successfully approved the smart contract.
  2. Otherwise, you can participate in staking through BitMax.

 

For public stakings (Validators and Delegators), the staking application built into the xDai network of BlockScout must be accessed. In the dropdown menu at the top-right corner, you can access the Staking app easily. (A web3wallet like MetaMask must be connected in order to participate.) 

  • More information on public staking can be found here.

 

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xDai Price Prediction

With a Market Cap of $92.8 million USD, the current xDai STAKE price is $21.902 as of March 06th, 2021, and is expected to display a tremendous increase in the near future.

 

xDai Price Prediction — 2021

The price is estimated to go up to $36.50 USD in the next month, and may reach an approximate value of $28.35 USD by the end of the year.

Source: Digitalcoinprice

 

xDai Price Prediction — 2023

An average price of $45.45 is expected in 2023, as seen in the forecast by DigitalCoinPrice.

 

xDai Price Prediction — 2025

In early 2025, xDai is predicted to start at $60 USD,, much higher than it has been in the previous years. Throughout the year, the cost of xDai could potentially rise to over $70 USD. This is in line with what DigitalCoinPrice is predicting as well.

 

xDai Price Prediction — 2030

Forecasted to show an exponential increase, xDai (STAKE) price is expected to exceed $100 USD.

 

xDai Alternatives

Similar to xDai stablecoin, there have been multiple other stable currencies in use, such as the well-reputed Tether (USDT), which is backed by traditional cash as well as gold, and USDC, another popular stablecoin backed by Coinbase. However, this unique sidechain of Ethereum is unrivaled and has no known similar networks.

 

xDai Social Media Handles

 

Social Media URL
Official Website https://www.xdaichain.com/
Discord (Tech Support) https://discord.gg/mPJ9zkq
Telegram (Community Chat) https://t.me/xdaistable
Twitter https://twitter.com/xdaichain
GitHub https://github.com/xdaichain
Telegram Announcement Channel https://t.me/xdai_official
Forum https://forum.poa.network/c/xdai-chain
Contact https://www.xdaichain.com/media/contact-us

 

Key Takeaways — xDai Review

  • xDai is a single token transactional model that is cost-effective and time-efficient.
  • Ideal for peer-to peer payments and other small transactions.
  • Predictable prices – Native currency is a stablecoin.
  • With xDai, users can avoid the congestion and volatility faced on the Ethereum Network.
  • xDai uses clever techniques in the form of STAKE tokens to ensure the chain is secure and protected.
  • xDai offers an inexpensive method for dApp developers, with easily accessible tools and user-friendly interface.

Evidently, xDai provides a bunch of desirable features that prove it more preferable over other crypto, especially regarding retailer payments and small transactions that occur daily. As new features will soon be added to the xDai chain, it will eventually become the leading stable payments blockchain platform.