Maker Surge Archives

12th April 2024

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

29th September 2023

MakerDAO Secures $6 Billion For Treasury Bill Investments As MKR Dominates 2023

According to a Bloomberg report, MakerDAO, one of the prominent decentralized lenders in cryptocurrency, has reaffirmed its decision to invest billions of dollars in US government bonds.

This strategic move has propelled its governance coin, MKR, to reach its highest level since April 2022, outperforming other major cryptocurrencies, including Bitcoin (BTC).

MKR has experienced a remarkable surge of 77% this quarter, emerging as the best-performing cryptocurrency of the year. Despite a modest decline of 3.9% to $1,452 on Friday, the coin has nearly tripled in value.

MakerDAO Doubles Down On Treasury Bonds

As per DefiLlama data, MakerDAO currently oversees $4.6 billion in assets. The rally of MKR can be attributed to MakerDAO’s 2022 decision to convert the backing funds of its stablecoin DAI into assets such as short-term US Treasuries and corporate bonds.

This strategic shift aimed to seek more stable yields amid the downturn in the cryptocurrency markets. Subsequently, MakerDAO passed a proposal enabling the investment of up to $6 billion in short-term Treasuries, doubling the existing limit.

Simon Peters, an analyst at investment platform eToro, suggests that the recent gains in MKR can be attributed to rising treasury yields following the Federal Reserve’s indication of keeping rates higher for longer.

However, signs of a potential slowdown in the MKR rally have emerged. CryptoQuant data reveals a gradual increase in MKR tokens held on centralized exchanges (CEX), indicating that some traders are preparing to secure profits from the recent surge.

Notably, the drop experienced on September 29 ahead of the monthly close marked the largest decline since mid-September.

According to Bloomberg, the trader enthusiasm for MKR has extended to DAI, MakerDAO’s stablecoin. DAI’s circulation has grown from a low of $3.9 billion on August 20 to $5.5 billion.

Furthermore, MakerDAO introduced a limited-time offer of an 8% annual yield to DAI holders, which, combined with the approval of the investment proposal, could potentially trigger a fresh wave of buying in short-term Treasuries.

Allan Pedersen, the CEO of Monetalis, a firm assisting MakerDAO in its investments, expressed that if the supply of DAI continues to increase, it could lead to a significant expansion of MakerDAO’s T-bill investments in a short time frame.

The developments surrounding MakerDAO’s investment strategy in US government bonds, which have propelled MKR to new heights, signify a calculated move to achieve stability and sustainable yields by the decentralized protocol.

MKR Hits 18-Month High

MKR has declined over 4.5% in the past 24 hours, causing the token to retrace to its current trading price of $1,452. However, over the last month, MKR has exhibited consistent gains across various time frames, with notable increases of 12%, 19%, and nearly 40% over the seven, fourteen, and thirty-day periods, respectively.

Furthermore, MKR has reached an impressive 18-month high, surging by 101% year to date and briefly peaking at $1,590 earlier on Friday.

MakerDAO

In the short term, safeguarding against an extended decline, MKR has two crucial support levels that bulls must defend. The first immediate support rests at $1,430, while the second support level, spanning two months, is positioned at $1,341.

Meanwhile, MakerDAO and its ecosystem appear poised for further gains with their investment strategy. With a few months remaining in 2023, there is a potential for MKR to conclude the year as the top-performing asset if the ongoing rally continues.

Featured image from Shutterstock, chart from TradingView.com

28th September 2023

Maker (MKR) Rockets To $1,500 With 15% Surge, Will This Run Continue?

The Maker token, MKR, has managed to break the $1,500 level with a sharp 15% rally as on-chain data shows MKR has seen high address activity recently.

Maker Has Outperformed Top Coins With 15% Rally In Past Week

While giants like Bitcoin have struggled recently, MKR has proven to be different as the coin has observed an impressive run of bullish momentum. Following the latest leg up in the asset’s rally, it has surged past the $1,500 level, a feat it hasn’t replicated since May 2022, almost a year and a half ago now.

The below chart shows what the asset’s recent rally has looked like:

Maker Price Chart

Out of the top 100 cryptocurrencies by market cap, only Chainlink (LINK) and Curve (CRV) have seen better returns than Maker’s 15% gains during the past week.

Even these two assets haven’t seen bullish momentum as consistent as MKR in the past month, though, as MKR’s superb 42% profits in the period notably outshine theirs.

Maker Active Addresses Have Hit A 10-Week High

According to data from the on-chain analytics firm Santiment, this sharp run in MKR has come alongside a surge in the cryptocurrency’s “active addresses” metric.

This indicator keeps track of the daily total number of unique Maker addresses that are taking part in some kind of transaction activity on the blockchain. This metric’s value can simply be looked at as the amount of traffic that the network is receiving every day.

When the indicator has high values, it means that a large number of users are participating in the trading activity of the asset. Such a trend implies that interest in the coin is high currently.

Now, here is a chart that shows how the active addresses metric has changed for MKR during the past month:

Maker Active Addresses

From the graph, it’s visible that the Maker active addresses have climbed up alongside the rally in the asset’s price. After the latest increase in the indicator, its value has hit 651, which is the highest observed in around 10 weeks.

Generally, for any surge to be sustainable, it requires continued participation from a large amount of traders. Rallies that aren’t accompanied by a sufficient rise in user activity usually run out of steam before long.

Since the latest Maker surge has seen an increasing number of addresses becoming active, signs could be looking good for its sustainability. As the price continues its run, though, some investors might be tempted to harvest the high profits that they have amassed.

In the same chart, Santiment has also attached the data for the exchange netflow, which shows that some inflows of $7.6 million just have occurred towards centralized exchange platforms, implying that profit-taking may already be beginning.

This is a relatively modest amount, but the analytics firm warns that inflows can be something to be cautious about, as they could lead towards at least a temporary top in the price.