MakerDAO is based on a concept called CDP - Collateralized Debt Position. They call it debt, but it's basically a callable swap - you swap ETH with DAI (their "stablecoin"). Since ETH is a highly volatile asset (ranging from 30c to ~$4K), these swaps are over-collateralized, i.e. 150-200%. In case the market value of the ETH falling below the value of the DAI - the swap is called out (in their term - the CDP got liquidated). There are also additional fees (fines?) involved in liquidations.

If you lock your ETH into a CDP - you believe that ETH will not go down. You can also take the DAI from one CDP, exchange it to ETH, and then re-invest it into another (or the same?) CDP - thus creating a synthetic leveraged ETH long position. This can be repeated multiple times;)

My point was that people continued locking ETH into CDPs during the 2018's 90% fall in ETH prices, which only made sense if they had cheap ETH (i.e. insiders/OGs), and their goal was to prevent DAI from de-pegging.

MakerDAO's CDP doesn't seems to be the best instrument for making a LONG bet on ETH. You can just hold ETH, or you can buy ETH futures on Bitmex if you want leverage.

The problem with many algorithmic "stablecoin" designs is the assumption that there always will be speculators willing to take the risk in exchange of betting that peg will be restored. But unlike the designated market makers in some regulated markets, crypto speculators are not contractually obligated to take the risk.