In traditional finance, a derivative is a contract that derives its value from the performance of an underlying entity. This underlying entity can be an asset, index, or interest rate, and is often simply called the β€œunderlying.”

Redeemable Dai (rDai)

rDai (redeemable DAI) allows you to invest your money in an Interest generating pool, used for collateralized loans. You still hold on to the exact amount you invested, and can spend and transfer it at will.