What Is Maker (MKR)? Should You Invest In MKR And Where to Buy It?

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Cryptoasset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

Last Updated January 17th 2022
168 Min Read

It's been 13 years since the first-ever digital currency (Bitcoin) was created. Within the period, thousands of altcoins have been created.

We all know that Bitcoin is a millionaire maker. Several of the altcoins created after Bitcoin has also become millionaire makers. Many people have made fortunes by investing in digital coins, and as the market continues to grow, many people will make much more money from trading and investing in cryptocurrencies.

Making money from cryptocurrencies can be easy, especially when you know the right coins to invest in. Maker (MKR) is one of the coins that has been attracting investors in recent times.

So, what is Maker (MKR)? Should you invest in Maker? And where can you buy the coin safely?

We understand that many crypto-curious individuals and active traders\investors may have several important questions regarding Maker. Here, we will answer these important questions and add several other important pieces of information that can help every reader make an informed decision about investing in the coin.

It is really important that you read this guide carefully because you will have to make the decision to invest or not to invest. However, we will discuss the coin as honestly as possible to help you make the right decision for your financial wellbeing.

If you want to buy Maker quickly and easily, check out eToro!

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

What Is Maker?

Maker is a cryptocurrency that is built on the Ethereum token. It is the governance token of the Maker Decentralized Autonomous Organization (MakerDAO) and the Maker Protocol, which is a software platform, based on the robust Ethereum blockchain that allows developers to create several projects.

The Maker project was launched to operate DAI, a community-managed decentralized cryptocurrency pegged against the USD. It has developed into a vibrant ecosystem and is regarded as one of the earliest projects on the evolving decentralized finance (DeFi) scene.

To understand the true essence of Maker, we need to appreciate the unique role of MakerDAO. This application was created to make lending and borrowing easier in the cryptocurrency universe. The system simplifies everything for all parties by eliminating the need for middlemen like financial institutions, or even an ATM. It even has its own stablecoin, simply called DAI.

Like other cryptocurrency projects on the Ethereum Blockchain, the entire Maker ecosystem run on smart contracts. Smart contracts are great in decentralized finance because they are self-executing lines of code that do not require third-party interference. Once the transacting parties fulfil their contract obligations, smart contracts run automatically to ensure smooth transactions. It is impossible for contracts to be broken, and potential litigations are completely avoided.

Before we discuss the history of Maker, it is important to point out that Maker has a native currency, like other cryptocurrency projects. The native currency is an ER-20 token that serves as the governance token. This is the digital asset you will get for investing/buying into the Maker project.

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Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

Brief History of Maker

The maker project was reportedly conceived in 2015. However, it did not take off till 2017. The entire thing was founded by Rune Christensen, a Danish entrepreneur from Sealand. Christensen was a Biochemistry graduate of Copenhagen University who also studied International Business at the Copenhagen Business School.

Before venturing into cryptocurrencies, Christensen co-founded and managed the Try China international recruiting company.

When the maker project was started in August 2015, it was the first tradable token on the Ethereum blockchain. The Maker platform was eventually launched in April 2016, though it wasn’t an independent ecosystem at the time. Funds were primarily issued through the exchange of Bitcoins (BTC) and Ethereum (ETH) for MKR tokens.

The maker project had a major breakthrough in December 2017 when it created an asset linked to the US dollar (USD). This asset, which is called the DAI token is a stablecoin that exchanges with USD at a ratio of 1:1. The project has recorded several other signs of progress in the last three years.

What Makes Maker Unique?

One of the first important things to know about Maker is that it operates a stablecoin (DAI). Since October last year (2020), it has always been rated among the best stablecoins. In fact, it currently has more active addresses than Tether (USDT), which is recognized as the largest stablecoin.

The growth and popularity of DAI are mostly due to the fact that it allows holders to directly participate in the governance process. As a holder of the Maker token, you will be eligible to vote on a number of changes to the Maker Protocol. Voting power is ultimately determined by the size of MKR investment/stake.

Community governance is one of the major factors driving the demand for MKR tokens, and this directly affects the value of the coin positively.

Though Maker is not the only coin with two distinct tokens, this is also a factor that makes it special. The platform has DAI (the stablecoin), which is tied to the USD and helps to control volatility and MKR, which is the governance token and major investment vehicle. DAI is also used for cryptocurrency lending while MKR is used to back up the value of DAI and also gives holders voting power in the platform.

Read Also: 15 Reasons Why You Should Invest in Maker (MKR) Today

More About the Maker Token (MKR)

If you are planning to trade/invest in Maker, then MKR is the token you want to pay close attention to. It is one of the native currencies of the platform and the primary investment vehicle you will need to buy to enjoy the benefits of investing in the network.

The first important thing to know about Maker (MKR) is that it is different from DAI. While DAI is a stablecoin that is always equal to 1 dollar, MKR is a regular cryptocurrency that can gain or lose value with time. It is the coin you can buy when the price is low and sell for a profit when the price increases.

Maker is basically an ER-20 token that is available in many exchanges and crypto platforms. It is the native currency that represents an investment into the Maker project. For the purpose of this article, we will use Maker and MKR interchangeably from this point.

The Maker platform is one of the most popular Ethereum-based platforms, and MKR is one of the most popular ER-20 coins. It serves two major purposes – it is the major investment vehicle in the network and also the governance token that allows investors to vote for proposed changes in the network.

At the time of writing this piece, Maker was trading at $2,118.78. In the last 24-hour, it has reached a high point of $2,256.88 and a low point of $2,115.34. MKR has a market capitalization of $2 billion, making it the #59 ranked cryptocurrency in the world by market capitalization. However, the fully diluted market capitalization is $2.13 billion.

There are 984,803.39 MKR in circulation and that is the Total supply. The maximum supply, however, is a little higher at 1,005,577 MKR.

Check Out: Maker Price Prediction – Will Maker Rise in Value?

Should You Invest In Maker?

Are you thinking of investing in Maker? Are you having second thoughts about the viability of the coin and its potentials for growth? Here is where we discuss the MKR coin to see if it is a good fit for your cryptocurrency portfolio.

There are several exciting things about the Maker network, and we have discussed the major ones. However, these alone shouldn’t inform your investment decision. It is important to consider every important thing that regards the past, presence, and future of the coin before jumping in with your money.

Ideally,investors focus on digital coins that have a proven history of good performance and potentials for future growth. Fortunately, Maker (MKR) falls under this category. MKR has grown significantly from 2018 to this point. The price has moved from about $24.3 in 2018 to more than $3,400.

The all-time low price of the coin was recorded as far back as January 30, 2017 (2017). It reached an all-time high of $6,339.02 on May 03, 2021 (3 months ago.) That is a monumental growth, even for a fast-growing cryptocurrency. The coin is also likely to rise further in the near future.

Read More: Why Maker Coin Will Skyrocket

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Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

What Are The Benefits Of Maker?

Investing in Maker MKR offers several benefits, even beyond its potential price growth.

One of the major benefits of the Maker project is that it solves real-world financial problems. The project was started to tackle multiple issues that trouble the traditional financial sector, including lending and borrowing. It is a critical network in the DeFi community, and the native coins (DAI and MKR) are playing huge roles.

The primary benefits of Maker include:

✅ Two Powerful Tokens

Though there are several other cryptocurrencies that employ two tokens, Maker has distinguished itself due to the functionalities of its tokens. DAI is tied to the USD while MKR is used to support the stability of DAI and also for community governance.

Even when the market becomes very volatile, investors have little or nothing to fear as the network has adequate strategies to sustain the values of the tokens.

Community Governance

As stated earlier, every investor or trader of MKR has voting rights when it comes to the governance of the system. Being able to vote on proposed changes gives investors more power in the network and its future. Though your voting power depends on your stake, you will always have a level of control over the affairs of things in the network.

Advanced Smart Contracts

We’ve already hinted that smart contracts are great for several reasons. What is better? Maker has advanced smart contracts capabilities that make transactions in the network a lot more secured. It utilized what is called Collateralized Debt Position (CDP) in its lending and borrowing processes. This makes Maker self-sufficient and offers users improved security and peace of mind. It is a transparent system.

Deflationary Protocol

To help maintain its value over time, Maker employs what is known as Deflationary protocol. The Advanced smart contracts include a small interest fee once it closes. A portion of the fee is also burned after a transaction, and this helps maintain a healthy balance between the supply and demand of the asset. This is a key feature in DeFi, and many related platforms are just trying to catch up. From all indications, Maker will continue to dominate the lending and borrowing niche ahead of similar projects like Aave and Compound.

Significant Growth and Potentials

We’ve already discussed how MKR has grown in the past years, albeit briefly. The coin’s price has moved from just over $20 to more than $3,400 per token. In fact, it reached an all-time high of more than $6000 in recent times.

MKR also has the potentials to grow a lot bigger in the future. It may take a while for the coin to reach the record it set a few months ago, but there is no reason to believe that the next bullish market will not see the price of the coin skyrocket again. Of course, that will yield huge profits for investors and smart traders.

Relevant Partnerships

One of the major characteristics of successful cryptocurrency projects is the backings of major real-world corporations. This mostly comes in the form of partnerships, and Maker has highly relevant ones. At the moment, the network is in partnership with CargoX, Digix, Omisgo, Swarm, and Request Network. Many exchanges have also supported Maker or used it in one way or the other.

Don't Miss: Why Maker Coin Is Going to Explode

Why Reconsider Investing In Maker?

From the content of the last few paragraphs, you can tell that Maker is one of the best coins to invest in. This, however, does not mean that the platform and its native coins do not have any drawbacks. There are some concrete reasons to think twice about investing in MKR, and we will briefly discuss the major ones here:

❌ General Volatility

Maker has a strong and reliable system, but it is not completely immune to the volatility that rules the cryptocurrency universe. With the two-token system and other strategies, the network tries to bring stability to the market, but the price of MKR will always respond to market forces, and this can always lead to losses and profits. The key is understanding the market and taking the right actions at the right time.

❌ Competitions

Maker obviously has its place in the Cryptocurrency universe and the evolving DeFi scene, but it is not alone. There are other cryptocurrencies that focus on lending and borrowing, and they are direct competitions to MKR. This, however, does not mean that MKR is going anywhere any time soon. In fact, it is already a leader in the niche but the team must work hard to maintain this lead. Other major cryptocurrencies like Bitcoin and Ethereum can also be seen as alternative assets, even though they are not in direct competition with Maker. In any case, healthy competition can help the platform and its native coins grow even bigger.

Where Can You Buy Maker (MKR)?

Have you made up your mind to invest in Maker (MKR)? It is important to understand the right place to buy. There are several platforms you can buy MKR. As a popular coin, it is available in almost all major exchanges. You can also buy from reliable brokerages like eToro, as well as apps that are not official exchanges or brokerages.

To an extent, it is safe to buy your MKR from any platform. However, you need to know that there are scam artists who operate terrible sites with malicious intentions. It is generally believed that buying from exchanges and brokerages is always better.

Even when you buy your MKR or any other digital asset from a brokerage, there is some level of risk involved. The transaction may happen smoothly, but leaving your coin at such exchanges exposes them to hackers. It is all about the security of the platform and how smartly you transact.

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Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.

The Best Platform to Buy Maker (MKR)

You can tell from the three paragraphs above that we support buying cryptocurrencies from reliable brokerages instead of exchanges and apps.

There are a few full-service brokerages that allow cryptocurrency enthusiasts to invest in digital coins. eToro is one such stockbroker and has earned a reputation as the best social platform for trading cryptocurrencies.

There are so many reasons to choose eToro ahead of other platforms for cryptocurrency investments, and we can’t fully discuss them here. One of the major advantages of the platform is that it is great for traders/investors of all experience levels.

eToro boasts of a user-friendly interface and several other qualities. Even if you are new to crypto trading/investing, you can take few easy steps and get yourself into a position that makes profit-making easier. They also have a system that minimizes your risks as you trade volatile cryptocurrencies and other investment vehicles.

What Next After Buying Maker?

As hinted earlier, leaving your crypto assets in a crypto exchange is an investment risk you need to avoid. Digital currencies are meant to be stored in a digital wallet, and getting one should be one of your priorities if you want to venture into crypto trading and investing.

It is also important to state that there are security challenges that confront the digital wallet scene. Therefore, it is really important that you consider the security features of any wallet before using it for cryptocurrency activities/transactions.

Another major reason we recommend eToro ahead of other platforms is that it offers a digital wallet. If you invest in cryptocurrencies through eToro, you will get a secure, multi-coin wallet. You can confidently keep your digital assets in their wallet and grow your crypto portfolio with peace of mind.

Key Points to Keep In Mind

We’ve covered the most important information you need to decide whether investing in Maker will be the right thing for you. We understand that it is a lot of information to digest, so here is a summary of the key points to keep in mind:

  • Maker is a robust Ethereum-based cryptocurrency that has experienced tremendous growth in the past four to five years.
  • Maker has two native tokens – DAI (a stablecoin tied to the USD) and MKR (an ER-20 digital asset and a governance token for the MakerDAO).
  • Maker focuses on lending and borrowing but allows investors and traders to earn in different ways.
  • Maker has a robust infrastructure and utilizes several key strategies to keep its network solid and protect investors from some of the problems of crypto trading/investing, including volatility.
  • MKR is still a cryptocurrency, so is prone to volatility.
  • MKR is a leader in the cryptocurrency lending and borrowing niche and has huge potentials for growth.
  • eToro is the best platform to buy and sell Maker (MKR) and several other cryptocurrencies and investment vehicles for investors of all experience levels.
  • It is important to store your crypto assets in a safe digital wallet, and eToro offers an easy-to-use, multi-crypto, secure wallet for all investors.

Are You Ready To Invest In Maker (MKR)? Do It the Smart Way

Investing in cryptocurrencies can be rewarding. However, it comes with major risks that can make inexperienced investors/traders lose their monies. It is important that you learn about cryptocurrencies and research properly before making any investment decision.

Trading Education is one of the best platforms to research any digital coin and other investment vehicles. We have tons of relevant articles and guides to help you become a decent or even an exceptional online trader/investor.

eToro – Best Exchange To Buy Maker

eToro have proven themselves trustworthy within the crypto industry over many years – we recommend you try them out.

Crypto asset investing is highly volatile and unregulated in some EU countries. No consumer protection. Tax on profits may apply.