Skip to main content
Learn

How Does the Dai Savings Rate (DSR) Incentivize Users to Hold a CDP-generated Stablecoin?

The DSR pays you interest for just holding the stablecoin, creating a reason to buy and hold it, which helps maintain its price.
Greeks.Live31.10.25

How Does the Dai Savings Rate (DSR) Incentivize Users to Hold a CDP-generated Stablecoin?

The Dai Savings Rate (DSR) is a variable interest rate that holders of the Dai stablecoin can earn by locking their Dai into a specific smart contract. This rate is funded by the stability fees paid by borrowers who have opened CDPs.

By offering a native yield, the DSR creates a baseline demand for holding Dai. If the market price of Dai falls below its peg, governance can increase the DSR to incentivize more people to buy and hold Dai, thereby driving the price back up.

It acts as a powerful monetary policy lever to influence supply and demand.

What Is a De-Pegging Event for a Stablecoin and What Are Its Consequences for an LP in a Stablecoin Pool?
What Is the Difference between a Single-Collateral and Multi-Collateral CDP System?
How Do Decentralized Stablecoins (Like DAI) Maintain Their Peg Compared to Centralized Ones (Like USDC)?
How Does a CDP Create Leverage for a User in Decentralized Finance?

About

Contact

Editorial Policy

Terms of Service

Privacy Policy

Cookie Policy

© 2025 Greeks.Live

All Rights Reserved

Greeks.Live RFQ

Build by Noo on Engine

Source: The content on this website is produced by Greeks.live's proprietary analysis systems, which utilize advanced Large Language Models (LLMs). This information might not be subject to a full human review before publication and may contain errors.
Responsibility: You should not make any financial decisions based solely on the content presented here. We strongly urge you to conduct your own rigorous due diligence and to consult a qualified, independent financial advisor.
Purpose: All information is intended for informational purposes only. It should not be construed as financial, investment, trading, or any other form of professional advice. News and data are not trading signals.
Risk: The cryptocurrency, derivatives, and options markets are highly volatile and carry significant risk. By using this site, you acknowledge these risks and agree that Greeks.live and its affiliates are not responsible for any financial losses you may incur.