It is a popular (mainly human) superstition that the dae were borne out of Hell, straight from the womb of the Devil. Satan Spawn is a familiar nickname for the daefolk; most consider it a slur, but some dae accept their demonic stereotypes. It is easier to be bad when being evil is just in your nature.
The idea that Lucifer, Beelzebub, the Devil, etc... spawned the dae race comes from the idea that the dae originated from some underground place and one day emerged into the human world to cause chaos and strife. Many humans use the myth to spread fear and hatred of the dae, although that does not go to plan when some dae choose to use the creation story to their own advantage.
The myth first arose from word of mouth a few decades after the dae emerged and started integrating into human society. It has twisted and changed over time, but it has kept the central message that dae are hell-beasts and are borne from the Devil himself.
Of course, the myth is met by humans with fear, anger, and disgust. They use it to hate and harm the dae even if it has no scientific backing. While some humans are willing to look past the demonic backstory, others vehemently hold the myth as their main reason for hating the daefolk. Even those who claim to be allies of the dae often silently fear them because of the hellish myth. In return, the dae did their best to discredit and deny the myth. It spread nonetheless, and they eventually came to live with it and shrug off the hatred people threw at them because of it.
The story has cause a fair bit of strife between humans and dae, perhaps disallowing them from integrating further because of the humans' 'ingrained' fear of the dae.