Chai

Built on the Ethereum blockchain, Chai is an ERC20 token that enables Dai holders to earn interest without locking their coins in the Dai Savings Rate. Operating as a simple wrapper over the Dai Savings Rate, Chai allows users to convert their Dai into CHAI, which can be transferred freely and redeemed for an ever-growing amount of Dai. This innovative solution solves the problem of Dai being locked in the savings contract, making it transferable, fungible, and ready for further DeFi integrations.

The key technical feature of Chai is its ability to "unlock" Dai savings balances, making them transferable and usable in other dapps. This is achieved through a straightforward ERC20 wrapper that enables users to convert their Dai into CHAI, which can then be redeemed for additional interest. The contract also supports gasless token interactions, allowing users to give approvals using signed messages (permits) without committing to a particular way of doing transfers or other token interactions.

Chai has several real-world applications, primarily in the DeFi space. Users can earn risk-free interest on their Dai by converting it into CHAI and holding it in the contract. The CHAI balance remains constant, but its corresponding Dai value grows with the Dai Savings Rate. This allows users to redeem their Dai along with additional interest or continue using the CHAI token directly. The Chai contract has undergone a two-day security review by Trail of Bits without any security-related findings.

The Chai project was developed by Martin Lundfall, Lucas Vogelsang, and Lev Livnev, with pixel art provided by Abbey Titcomb. The source code for the Chai contract can be found on GitHub at github.com/dapphub/chai, while the source code for chai.money is available at github.com/lucasvo/chui. The project is distributed under the AGPL license.

The Chai contract lives on the Ethereum mainnet at address 0x06AF07097C9Eeb7fD685c692751D5C66dB49c215, with a total of 7,104,700.94 Dai locked in the contract at the time of writing. The Dai Savings Rate is currently 1.25% per year, and users can earn interest on their CHAI by holding it in the contract.