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DAI Circulation Approaches 5 Billion As MakerDAO Unleashes Key Updates

In a recent announcement on the social media platform X (formerly Twitter), MakerDAO, the Ethereum-based protocol responsible for issuing the DAI algorithmic stablecoin, provided insights into the performance of the Maker Protocol following recent changes.

Over the past few weeks, MakerDAO has implemented significant updates to the protocol and the DAI stablecoin. 

Introducing the Accelerated Proposal and the direct deposit module (D3M) to Spark’s Metamorpho Vault has notably impacted the ecosystem.

Increased DAI Supply And Demand

Looking at key metrics that demonstrate the effects of these changes to the protocol, the DAI supply in circulation currently stands at nearly 5 billion, reflecting a growth of approximately 300 million over the past month. This growth indicates continued demand for the stablecoin. 

On the other hand, the Dai Savings Rate has significantly increased since implementing the Accelerated Proposal. 

Approximately 1.54 billion DAI are currently deposited in the Dai Savings Rate, of which approximately 976 million DAI are sDAI, representing an increase of roughly 400 million DAI in deposits.

The Maker Protocol’s total value locked (TVL) amounts to approximately $8.4 billion across various vault types. This TVL growth can be attributed to strategic deployments in D3M modules, significant contributions from Ethereum-based collaterals, and the integration of real-world assets. These developments have enhanced the protocol’s diversification and resilience.

MakerDAO Ethereum Vaults Thrive

A notable addition to the MakerDAO ecosystem is the Morpho DM3, which enables the Morpho Vault to mint DAI. Currently, the lending pool has deployed 200 million DAI.

According to the protocol’s post, this allocation is projected to generate approximately 50 million in annual income for the Maker Protocol, making it the second-largest core vault in terms of annualized fees. It will play a significant role in generating revenue and contributing to the Maker Protocol’s sustainability.

Among the Ethereum vault types within the MakerDAO ecosystem, the ETH-C vault stands out with the largest value locked in crypto collateral at approximately $1.88 billion. 

This vault generates approximately $43 million in annual fees, underscoring its importance within the Maker ecosystem and contribution to the protocol’s revenue streams.

Another important component is the Spark D3M, which is supplied with around 970 million DAI. This module is projected to generate an annual income of approximately 28 million. 

These recent changes have positively impacted the Maker Protocol. The increase in DAI supply, growth in the Dai Savings Rate, expansion of collaterals, and introduction of different vault types have contributed to the protocol’s growth and development. 

MakerDAO

Despite the growth in the MakerDAO ecosystem, the native token MKR has experienced a continuous 5.9% price decline over the past fourteen days. 

In the last seven days alone, the token has recorded a significant 17% price drop, resulting in its current trading price of $3,355.

However, despite the price decline, Token Terminal data reveals positive trends. The protocol’s market capitalization currently stands at $3.3 billion, reflecting a notable 28% increase over the past 30 days. 

Additionally, trading volume for the MKR token has experienced a substantial surge, reaching $5.9 billion, representing a 119% increase over the same time frame.

Featured image from Shutterstock, chart from TradingView.com 

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MakerDAO Initiates Massive $600 Million DAI Investment In USDe And sUSDe

Decentralized Finance (DeFi) protocol MakerDAO is considering allocating 600 million DAI stablecoins to the USDe and staked USDe (sUSDe) protocols through the DeFi lending platform Morpho Labs. The proposed allocation aims to improve risk management and maximize user incentives in the DeFi landscape.

MakerDAO Sets Maximum 600 Million DAI Allocation

The Spark DAI Vault, launched in 2023 as a lending platform, experienced strong demand soon after its launch, according to MakerDAO’s announcement on the protocol’s governance forum. 

Given the desire to keep liquidity risk at an acceptable level, MakerDAO proposes a greater allocation of DAI to the USDe pools, which can be immediately redeemed via Ethena (ENA), a synthetic dollar protocol developed on the Ethereum blockchain. 

This reallocation also allows Ethena to retain a larger revenue share for their insurance fund, potentially improving the overall risk profile of MakerDAO’s Ethena allocation.

Furthermore, MakerDAO recommends focusing future allocations on the 86% and 91.5% Loan-To-Liquidity-Value (LLTV) pools, which have shown “higher efficiency” regarding borrow rates and user demand. While lower LLTV pools, such as the 77% and 94.5% pools, will continue to receive allocations, they will be proportionally lower than the two primary pools.

To mitigate potential insolvency risks and ensure a favorable risk-reward ratio, MakerDAO limits the total allocation to 600 million DAI. However, the Dividend Debt Mechanism (DDM) line parameter is set at 1 billion DAI to provide flexibility for future increases if constraints change.

In addition, MakerDAO recommends marginally increasing the funds deployed in the 77% and 94.5% pools to 10 million DAI each to ensure sufficient pool size for “efficient management of positions” and the calibration of interest rate models.

The recently unveiled Ethena points program for Season 2 introduces a $500 million cap on total eligible collateral for incentives on Morpho. If demand for DAI borrowing through the vault declines after this threshold is reached, the protocol states that Multisig can reduce allocations below $600 million to maintain a balanced supply/demand dynamic and align with expected collateral returns.

MKR Surges To Near Three-Year High

MakerDAO’s native token, MKR, hit a nearly three-year high of $4,074 on Sunday, which is 40% below its current all-time high (ATH) of $6,292 in May 2023. The token has pulled back nearly 2% and is currently trading at $3,717. It is consolidating above its next support level of $3,640.

Despite the retracement, MKR still boasts significant gains over longer time frames. It has posted a 25% gain over the past fourteen days and an impressive 80% gain over the past thirty days. 

Demand for MKR tokens is evident as trading volume has increased to $274,659,607 over the past 24 hours, a substantial 40% increase from just one day ago, according to CoinGecko data. In addition, MKR’s market capitalization has seen a remarkable increase of nearly 100% over the past month. 

Starting in March with a market cap of $1.8 billion, as of the most recent update on April 2nd, the market cap stands at $3.46 billion. This significant increase underscores the high level of interest in the MakerDAO protocol and its native token.

MakerDAO

Featured image from Shutterstock, chart from TradingView.com 

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MakerDAO Stakeholder-Focused Updates Drive MKR Price Up By 10%

Blockchain protocol MakerDAO (MKR) continues to see significant gains, maintaining a strong upward trend throughout the year. MKR has seen significant growth of over 358%, accompanied by positive metrics reflecting increased adoption and usage of the protocol.

In addition, upcoming voting initiatives aim to further increase the platform’s benefits for its stakeholders.

MakerDAO Announces Plans For Rate System Changes

In a recent announcement, MakerDAO stated that it closely monitors developments in the cryptocurrency market and has gained a better understanding of the impact of recent proposals. 

As a result, the protocol is recommending the next set of changes to its rate system. MakerDAO emphasized that further adjustments will likely be introduced shortly, contingent upon market dynamics, such as prices, leverage demand, and the external rate environment encompassing centralized finance (CeFi) funding rates and decentralized (DeFi) effective borrowing rates. 

The protocol further noted that the Maker rate system will be adjusted accordingly if the external rate environment continues to exhibit signs of decline.

Efforts are underway to update the rate system language within the Stability Scope, including developing a new iteration of the Exposure model. These updates aim to ensure that the system can adjust rates more gradually and effectively in the future.

Based on recommendations from BA Labs, a blockchain infrastructure provider, the Stability Facilitator proposes various parameter changes to the Maker Rate system, which will be subject to an upcoming Executive vote. 

MakerDAO

As shown in the table above, the proposed changes include reducing the Stability Fee by 2 percentage points for various collateral types such as ETH-A, ETH-B, ETH-C, WSTETH-A, WSTETH-B, WBTC-A, WBTC-B, WBTC-C. In addition, the Dai Savings Rate (DSR) and the Effective DAI Borrowing Rate for Spark will also be reduced by 2 percentage points.

However, one active protocol user offered an alternative viewpoint, suggesting using the demand shock opportunity to expand the net interest margin. While agreeing with the proposed 2% interest rate reduction for borrowers, the user advocates for a larger 4% reduction in the DSR, which he believes will further benefit MakerDAO’s net interest margin.

Ultimately, the outcome of the voting process will determine whether these proposed changes are implemented and benefit the stakeholders of MakerDAO. Further decisions regarding rates and fees will be made based on the results. 

Market Cap Skyrockets

According to data from Token Terminal, MakerDAO has demonstrated significant growth and positive performance across various key metrics over the past 30 days. 

In terms of market capitalization, MakerDAO’s fully diluted market cap has reached approximately $3.07 billion, reflecting a notable increase of 40.9% over the past 30 days. The circulating market cap is around $2.82 billion, showing a similar growth rate of 41.1%.

MakerDAO

On another note, the total value locked (TVL) in MakerDAO has increased by 10.1% over the past 30 days to approximately $7.05 billion. 

The token trading volume for MakerDAO has surged 126.6% over the past month, reaching approximately $4.35 billion. This increase in trading volume suggests heightened market activity and interest in the protocol.

In terms of user activity, MakerDAO has seen an increase in daily active users, with an increase of 32.2% to 193 users. On the other hand, weekly active users decreased by 22.6% to 783 users. However, monthly active users have shown a positive growth rate of 10.0%, reaching 2.88k users.

Short-Term Outlook For MKR

Regarding price action, MKR is currently trading at $3,158, reflecting a 4.8% growth in the past 24 hours, 10% in the past seven days, and an impressive 49% increase in the past fourteen and thirty-day time frames.

The token has encountered a support wall for the short term at $3,048. This support level is significant for the token’s growth prospects. Another key support level is at $2,884, which further contributes to the token’s short-term stability and potential growth.

MakerDAO

On the other hand, the nearest resistance level is observed at its 28-month high of $3,321. This level represents the highest point reached by the token since November 2021. 

Featured image from Shutterstock, chart from TradingView.com

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MakerDAO (MKR) Recent Rally Signals Potential For New Highs – $1,700 On The Horizon?

The MakerDAO native token, MKR, has surged toward its early August highs, sending bullish signals rippling through the cryptocurrency market. This resurgence has reignited optimism among investors and speculators alike, suggesting that MKR may be poised to explore uncharted territory. 

One of the pivotal factors driving this remarkable rally is the significant accumulation of MKR tokens by a group of crypto whales.

This acquisition, confirmed by on-chain data from Santiment, reflects the growing interest in the cryptocurrency among large holders. Such whale activity is often seen as a bullish signal, suggesting confidence in the asset’s long-term potential. 

Whale Activity And Its Impact On MakerDao (MKR) Price

Evidence of the burgeoning optimism surrounding MKR comes in the form of substantial whale activity. In a recent revelation, Lookonchain disclosed that two prominent crypto whales made a foray into the MKR market in September, injecting millions of dollars into the token.

A price report further corroborates this narrative, showcasing a discernible increase in MKR accumulation across the network.

The infusion of substantial capital by these whales has restructured the market dynamics, steering it into a bullish trajectory. This bullish momentum has propelled MKR’s price action, raising hopes for a sustained upward trajectory.

Supply Dynamics And The Road Ahead

A separate report resonates with the prevailing bullish sentiment, highlighting an intriguing observation. The supply of MKR tokens held by top addresses has exhibited a gradual uptick since September 6.

This intriguing development suggests that the recent price gains witnessed by MKR are more than just a fleeting phenomenon and may indeed have the potential for longevity.

MKR Sustains Weekly Advance

As of the latest data from CoinGecko, MKR is currently priced at $1,294, marking a 3.7% decline over the past 24 hours but still maintaining a seven-day surge of 9.1%. These price movements underscore the cryptocurrency’s recent resilience, giving investors optimism the token can hit the vaunted $1,700 target.

Related Reading: Bitcoin Enjoys Growing Favorable Conditions, Top Analyst Says

Maker DAO’s MKR token has experienced a remarkable resurgence, driven in part by the accumulation of tokens by influential crypto whales. The bullish sentiment has sparked hopes of new all-time highs, but caution is advised, as weak buying volume could jeopardize the sustainability of the rally.

As MKR continues its journey, investors and traders will keenly watch for signs of genuine demand to ascertain the token’s true potential in the weeks to come.

(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured image from iStock

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Maker (MKR) Signals Bullish Price Formation – Is $1.300 Around The Corner?

Maker (MKR), one of the prominent players in the decentralized finance (DeFi) space, has experienced a remarkable 11% price surge in the past seven days. Despite a slight drop in the last hour, the token’s performance remains impressive. 

Maker (MKR) Bullish Price Sentiment

Maker’s recent price performance has been noteworthy, with a solid 11% increase over the past week. The token also recorded a 4.21% price increase in the last 24 hours, indicating strong momentum in the short term. However, a minor correction of 0.81% in the past hour highlights the market’s volatility.

Currently trading at $1,220.43 per MKR, the token remains 80.75% below its all-time high of $6,339.02. While the recent price surge is encouraging, it is essential to consider the historical context and the factors influencing the crypto market’s dynamics.

Maker (MKR) is up 11% in the past week: Source @Tradingview

The MakerDAO community recently voted in favor of a temporary increase to the interest rate paid to holders of the protocol’s decentralized stablecoin, DAI. This proposal introduced the Enhanced Dai Savings Rate (EDSR), a mechanism to temporarily boost the Dai Savings Rate (DSR) to users during periods of low utilization.

Proposed by Maker founder Rune Christensen, the EDSR could increase the effective DSR to 8% when the utilization ranges from 0% to 20%. The mechanism is designed to decrease the DSR as utilization increases gradually.

Related Reading: Shiba Inu Reclaims 14th Spot In Market After 5% Jump

This isn’t the first time Maker has adjusted the DSR. In the past few months, the protocol has raised the DSR thrice: first to 1% in November, then to 3.3% in May, and finally incorporating a marginal increase to 3.49% in June. The latest EDSR proposal aims to incentivize DAI holders and stimulate demand for the stablecoin.

Stimulating Demand For DAI

Despite the recent increase in the DSR, data from Dai Stats shows that investors have only deposited $307 million in the DSR, representing a modest 6.7% of the total supply of DAI. The amount of DAI in circulation decreased to $4.6 billion from over $6.9 billion in the previous year.

In response to the declining circulation of Maker’s dollar-pegged stablecoin, the protocol is taking proactive steps to spur demand for DAI. By enhancing the interest rate DAI holders can earn, the protocol aims to attract more users and create a favorable ecosystem for DAI utilization.

Related Reading: Tether (USDT) Market Cap Reaches New Peak, Edges Toward $84 Billion Mark

The broader stablecoin market has also experienced a downtrend, with the total market capitalization sinking to $127 billion from nearly $160 billion a year ago. The introduction of EDSR is seen as a strategic move to increase the appeal of DAI and strengthen its position in the competitive stablecoin landscape.

What’s Next For Maker (MKR)?

As Maker continues improving the DAI ecosystem, investors closely monitor its governance decisions and the market’s response to the enhanced interest rate mechanism. The success of the EDSR proposal could drive further adoption of DAI and contribute to its overall liquidity in the market.

Moreover, the broader crypto market’s performance and regulatory developments will determine Maker’s future trajectory. If the bullish sentiments continue, Maker could surpass the $1,300 resistance point but if the opposite occurs the next support levels are $1,200 and $1,180. 

(This site’s content should not be construed as investment advice. Investing involves risk. When you invest, your capital is subject to risk).

Featured image from iStock, chart from TradingView

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Maker DAO Trends Higher As 50 EMA Holds As Support, Can The Price Breach $1,200?

  • MKR’s price shows strength as the price breaks out of a downtrend with good volume with eyes set on $1,200. 
  • MKR bounced from a low of $600 as the price rallied to a high of $1,000, preparing for a rally as the price eyes $1,200 key resistance.

The price actions shown by Bitcoin (BTC) have affected most altcoins negatively as some have lost their key support, but Maker Dao (MKR) continues to show immersed strength as price breaks out of a long downtrend movement. The Consumer Price Index (CPI) news released recently had a great deal of effect on the crypto market as the price of BTC declined to a low of $18,200 before a bounce to $19,300, with many altcoins like Trust Wallet Token showing bullish strength regardless. (Data from Binance)

Maker DAO (MKR) Price Analysis On The Weekly Chart

Previous weeks haven’t been the best for the crypto space and most projects as the CPI news negatively affected most projects as crypto assets struggled to secure their key support zone. 

The news saw the price of Bitcoin (BTC) having a sharp decline to a region of $18,200 before a bounce to $19,500; this decline led to many assets losing their support zones, but some crypto assets showed immense strength with the likes of MKR looking strong ahead of the weekly close.

After the price of MRK dropped to a weekly low of $600, the price rallied from this low to a high of $1,000, showing bullish signs as the price closed bullish and opened with a bullish candlestick.

The price of MKR has formed a bullish structure and could retest the high of $1,200 if the price of MRK breaks and close above this area of $1,200, acting as resistance, we could see a price rally to a high of $1,700, but if the price of MKR gets rejected the price at $850 would be a good support zone. 

Weekly resistance for the price of MKR – $1,200.

Weekly support for the price of MKR – $850.

Price Analysis Of MKR On The Daily (1D) Chart
Daily MKR Price Chart | Source: MKRUSDT On Tradingview.com

In the daily timeframe, the price of MKR continues to look bullish as price trades above key support formed at $850 by the uptrend line as the price continues to respect this uptrend line, helping MKR to maintain its bullish structure as price trends higher.

The price of MKR has shown strength, as the price has not gone below the uptrend line, as the price faces resistance to breaking above $1,200.

Daily resistance for the MKR price – $1,200.

Daily support for the MKR price – $900.

Featured Image From zipmex, Charts From Tradingview