Posted on

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 

Posted on

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 

Posted on

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

Posted on

Whales Accumulating Maker And Aave, Path To 2024 Highs?

On-chain data suggests that whales are accumulating large amounts of Maker (MKR) and Aave (AAVE), two leading decentralized finance (DeFi) tokens. This accumulation trend coincides with a broader cooling-off period in the crypto scene days after the United States Securities and Exchange Commission (SEC) approved 11 spot Bitcoin ETFs. 

Whales Accumulate MKR And AAVE

According to ScopeScan data, Anchorage Digital, a digital asset custody firm, purchased a significant amount of MKR on January 15. The firm acquired 12,103 MKR tokens, valued at approximately $24.7 million, from Coinbase, a leading crypto exchange in the United States. 

Two whales, “0xbb5f” and “0x4a7,” also accumulated large quantities of MKR and AAVE. Specifically, “0xbb5f” bought 50,000 AAVE and 2,452 MKR worth around $5.03 million and $4.95 million from Binance, a leading cryptocurrency exchange. Meanwhile, 0x4a7 purchased 39,000 AAVE and 2,350 MKR, valued at approximately $3.95 million and $4.75 million, also from Binance.

Whales accumulating Maker and Aave | Source: Scopescan

These whale purchases signal a strong belief in the long-term potential of MKR and AAVE. Maker and Aave are two of the world’s leading decentralized lending and borrowing protocols across DeFi. MKR serves as the governance token for MakerDAO, which also manages the DAI decentralized stablecoin. On the other hand, AAVE is the governance token of Aave, a top decentralized lending platform. 

According to the latest DeFiLlama data, Maker and Aave have total value locked (TVL) of over $8.4 billion and $7.3 billion, respectively.

Top DeFi protocols | Source: DeFiLlama

Notably, whales are accumulating MKR and AAVE when the DeFi scene is recovering following the sharp contraction from 2022. The industry manages over $56 billion, with Ethereum hosting more liquid DeFi protocols, including Lido DAO when writing in mid-January 2024. 

Will Maker and Aave Rally To New 2024 Highs On Recovering DeFi?

Last year, MKR and AAVE were among the top-performing DeFi tokens, with MKR rising by over 200% and AAVE appreciating by more than 150%. Protocol-specific fundamentals, including the launch of Spark in Maker, partly drove this strong performance.

Aave launched the GHO stablecoin and the Lens protocol on the Ethereum sidechain, Polygon. Moreover, expectations of the spot Bitcoin ETF forced aggressive traders to consider top DeFi protocols, lifting altcoins.

Maker price trending upward on the daily chart | Source: MKRUSDT on Binance, TradingView

As whales accumulate, there is more headroom for these tokens to grow. Presently, AAVE and MKR are lower, based on their respective performance in the daily chart. However, overly, the uptrend remains. To illustrate, MKR is within a bullish breakout formation with a critical support level of around $1,560. Any surge past $2,300 might ignite demand, lifting the token to new 2024 highs.

Posted on

Whale Alert: Big Players Scoop Up These 4 Altcoins, On-Chain Data Indicates

The transactions of ‘whales’ – large-scale investors – often set the tone for market trends. So far, recent on-chain data from Lookonchain, a renowned on-chain analytics platform, has unveiled a notable accumulation pattern in four specific altcoins.

Maker (MKR), ssv.network (SSV), Coin98 (C98), and RSS3 have emerged as the latest targets of these accumulative efforts. The data shows a series of substantial withdrawals of altcoins from Binance, a leading crypto exchange, hinting at a growing interest in these altcoins among heavyweight investors.

Notably, this trend of whale accumulation is not just a fleeting occurrence but a concerted effort that has been unfolding over recent months.

Diving Deep Into Whale Transactions: A Closer Look at the Accumulated Altcoins

The analysis by Lookonchain reveals intriguing details about the accumulated assets. A new wallet, identified as “0xB4aE”, mainly made waves by withdrawing 10 million RSS3 tokens, valued at approximately $1.44 million, from the OKX exchange.

This transaction underscores the growing interest in RSS3, a lesser-known crypto asset. In parallel, another prominent wallet, dubbed “0xb6a7”, substantially withdrew 114,227 SSV tokens from Binance, amounting to a value of about $1.93 million.

This same investor also transferred 2.77 million C98 tokens from Binance, signaling a bullish stance on these specific altcoins. It is worth noting that these transactions exemplify the strategic moves by whales, often aimed at leveraging market dynamics to their advantage.

The Maker (MKR) Movement: Whale “0x9e74 Leads the Charge

One of the most significant players in this scenario is the whale wallet “0x9e74”. Since July 2023, this investor has consistently withdrawn Maker (MKR) tokens from Binance, totaling roughly 4,776 MKR.

The most recent transaction involved moving $1.7 million worth of MKR from the exchange, bringing the total worth of MKR withdrawn by this investor to about $6.9 million. This consistent and targeted accumulation of MKR suggests a strong confidence in the future of this particular altcoin.

The Maker token, part of the MakerDAO ecosystem, has been a subject of interest, mainly due to its role in decentralized finance (DeFi) as a lender.

These large-scale movements by whales underscore a broader trend within the crypto world, where informed players are increasingly steering towards altcoins with strong fundamentals and potential for substantial growth.

Amid the accumulation of the altcoins above by whales, RSS3 and Maker are still the top gainers, with both altcoins seeing a surge in price by 34.8% and 10.7%, respectively, over the past two weeks.

Maker (MKR) price chart on TradingView amid whale altcoins accumulation

The remaining two altcoins, however, have seen slight gains and decline, with SSV seeing a mere 4.8% increase and C98 seeing an 8.6% plunge over the same period.

Featured image from iStock Chart from TradingView

Posted on

After A 170% Spike, Is The Maker (MKR) Dream Rally Over?

After rallying over 170% from June 2023 lows, there are signs that Maker (MKR) bulls are losing momentum, looking at price action and decisions by various whales acting via an intermediary. At spot rates, MKR is changing hands at near 2023 highs but is down 16% from October highs. 

Maker (MKR) Is Selling Off: The Bull Run Is Over?

MKR is dumping at an unexpectedly faster pace, reversing gains posted in early Q4 2023, a concern. According to The Data Nerd, Falcon X sent 5,690 MKR worth $8.52 million to multiple exchanges, mainly OKX and Binance, at an average price of $1,497. 

Falcon X deposits MKR to exchanges| Source: The Data Nerd on X

Typically, whenever crypto whales begin sending tokens to centralized ramps, as currently is the case, it can be interpreted as bearish. That whales are moving their coins to exchanges could indicate that they are planning to liquidate and exit their position. Subsequently, this can dent sentiment, forcing the token to dump.  

However, the timeliness of the transfer also matters. In some instances, tokens can be moved to exchanges and interpreted as bullish. This is because, depending on the situation, whales could move them to provide liquidity for other traders.

This can be the case with Falcon X. The platform provides institutional investors access to liquidity and execution services. Notably, Falcon X has, in the past, been used by other crypto exchanges and liquidity providers to offer other services. Since it acts on behalf of institutions and whales, it cannot be ascertained which of its clients is selling MKR. 

As of October 27, The Data Nerd statistics show that the platform holds 10,150 MKR worth $14.17 million at spot rates. Following the transfer, the tracker also shows that MKR is down 4%.

The “End Game” Pumps MKR To New Highs, A Pull Back Incoming?

Presently, MKR remains under pressure. As mentioned earlier, the token, though in an uptrend, rallying 170% in four months, is down 15% from October’s peaks. At the same time, there is a double top, a technical formation that may signal a local top.

Maker price on October 27| Source: MKRUSDT on Binance, TradingView

This pattern will only be invalidated if there is a sharp expansion above $1,650. Conversely, losses below $1,350 at the back of high participation levels could catalyze the sell-off.

In May 2023, MakerDAO, the issuer of MKR–the governance token of the underlying borrowing and lending protocol, announced the launch of the “End Game.” Herein, the protocol plans to deploy on its independent blockchain, introduce new features, and launch two tokens. 

In addition, Maker has introduced a smart burn mechanism that involves purchasing MKR tokens from the open market and burning them without needing to close any collateralized debt positions (CDPs).

Posted on

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

Posted on

MakerDAO Explores Tokenized T-Bills With $100 Million Allocation Plan

Steakhouse, a decentralized autonomous organization (DAO)-focused financial advisory firm, in collaboration with Phoenix Labs, a research and development company, has put forth a proposal urging the MakerDAO community to consider allocating up to $100 million from its reserves for investment in tokenized US Treasury Bill (T-Bill) products. 

The proposal, currently in the discussion phase, aims to explore new avenues for financial innovation within the decentralized finance (DeFi) ecosystem.

Unlocking Liquidity Efficiency for MakerDAO? 

MakerDAO, renowned as the issuer of the DAI decentralized stablecoin, has already made significant investments in US Treasuries through off-chain structures since 2022, amounting to over a billion dollars. 

By venturing into tokenized T-Bills, MakerDAO seeks to bolster its balance sheet by gaining exposure to low-risk, liquid traditional assets. This move aligns with their long-term strategy of strengthening the stability and sustainability of the protocol.

Tokenized T-Bills offer several potential benefits to MakerDAO and its community. Firstly, they provide higher transparency than off-chain structures, simplifying the auditing process and reducing the need for internal resources. 

With tokenized T-Bills, daily attestations can be streamlined, providing real-time visibility on investment performance. 

Additionally, tokenized products enable simpler accounting procedures by leveraging daily price feeds, eliminating manual profit returns associated with off-chain investments.

Furthermore, tokenized T-Bills offer the potential for increased automation. Asset-liability management, a manual and slow process for MakerDAO, can be automated through tokenized products. 

This automation would improve efficiency and reduce operational overhead, enabling MakerDAO to focus on other strategic initiatives.

In terms of liquidity, tokenized T-Bills present advantages over traditional off-chain investments. Redeeming stablecoins through on-chain tokenized products can be faster than selling off-chain and converting them back into stablecoins. This can provide MakerDAO with greater flexibility and responsiveness to market dynamics.

Maximizing Returns?

Despite the potential benefits, the adoption of tokenized T-Bills introduces certain considerations. One such consideration is the exposure to higher counterparty risk. However, a competitive market is expected to favor the more secure options, mitigating this risk to a certain extent.

Tokenized T-Bills also offer diverse liquidity and yield profiles, providing opportunities for MakerDAO to diversify its investment strategy. 

Products range from super liquid non-volatile options, which act more like lending protocols with collateralized T-Bills, to frictionless products that offer better rates but require longer subscription and redemption processes. 

According to the announcement, these options allow MakerDAO to leverage different trade-offs without reinventing the wheel and cater to varying needs within the DeFi ecosystem.

Steakhouse, Phoenix Labs, and BlockAnalitica will contribute their expertise in legal, financial, technical, and risk assessment domains to move forward with the proposal. 

Overall, the proposed allocation of up to $100 million for developing and experimenting with tokenized T-Bill products reflects MakerDAO’s commitment to continuous innovation and exploring new possibilities within the DeFi landscape. 

As the discussions progress, the community’s collective wisdom and insights will shape the future roadmap of MakerDAO’s investment strategy and contribute to the evolution of decentralized finance.

MakerDAO

As of the time of writing, the native token of MakerDAO, MKR, is currently trading at $1,113, reflecting a decrease of 0.7% over the past 24 hours. 

However, over the past seven and fourteen days, the token has demonstrated substantial performance, surpassing most cryptocurrency markets with gains of 2.5% and over 12%, respectively.

Featured image from iStock, chart from TradingView.com

Posted on

MakerDAO Explores Tokenized T-Bills With $100 Million Allocation Plan

Steakhouse, a decentralized autonomous organization (DAO)-focused financial advisory firm, in collaboration with Phoenix Labs, a research and development company, has put forth a proposal urging the MakerDAO community to consider allocating up to $100 million from its reserves for investment in tokenized US Treasury Bill (T-Bill) products. 

The proposal, currently in the discussion phase, aims to explore new avenues for financial innovation within the decentralized finance (DeFi) ecosystem.

Unlocking Liquidity Efficiency for MakerDAO? 

MakerDAO, renowned as the issuer of the DAI decentralized stablecoin, has already made significant investments in US Treasuries through off-chain structures since 2022, amounting to over a billion dollars. 

By venturing into tokenized T-Bills, MakerDAO seeks to bolster its balance sheet by gaining exposure to low-risk, liquid traditional assets. This move aligns with their long-term strategy of strengthening the stability and sustainability of the protocol.

Tokenized T-Bills offer several potential benefits to MakerDAO and its community. Firstly, they provide higher transparency than off-chain structures, simplifying the auditing process and reducing the need for internal resources. 

With tokenized T-Bills, daily attestations can be streamlined, providing real-time visibility on investment performance. 

Additionally, tokenized products enable simpler accounting procedures by leveraging daily price feeds, eliminating manual profit returns associated with off-chain investments.

Furthermore, tokenized T-Bills offer the potential for increased automation. Asset-liability management, a manual and slow process for MakerDAO, can be automated through tokenized products. 

This automation would improve efficiency and reduce operational overhead, enabling MakerDAO to focus on other strategic initiatives.

In terms of liquidity, tokenized T-Bills present advantages over traditional off-chain investments. Redeeming stablecoins through on-chain tokenized products can be faster than selling off-chain and converting them back into stablecoins. This can provide MakerDAO with greater flexibility and responsiveness to market dynamics.

Maximizing Returns?

Despite the potential benefits, the adoption of tokenized T-Bills introduces certain considerations. One such consideration is the exposure to higher counterparty risk. However, a competitive market is expected to favor the more secure options, mitigating this risk to a certain extent.

Tokenized T-Bills also offer diverse liquidity and yield profiles, providing opportunities for MakerDAO to diversify its investment strategy. 

Products range from super liquid non-volatile options, which act more like lending protocols with collateralized T-Bills, to frictionless products that offer better rates but require longer subscription and redemption processes. 

According to the announcement, these options allow MakerDAO to leverage different trade-offs without reinventing the wheel and cater to varying needs within the DeFi ecosystem.

Steakhouse, Phoenix Labs, and BlockAnalitica will contribute their expertise in legal, financial, technical, and risk assessment domains to move forward with the proposal. 

Overall, the proposed allocation of up to $100 million for developing and experimenting with tokenized T-Bill products reflects MakerDAO’s commitment to continuous innovation and exploring new possibilities within the DeFi landscape. 

As the discussions progress, the community’s collective wisdom and insights will shape the future roadmap of MakerDAO’s investment strategy and contribute to the evolution of decentralized finance.

MakerDAO

As of the time of writing, the native token of MakerDAO, MKR, is currently trading at $1,113, reflecting a decrease of 0.7% over the past 24 hours. 

However, over the past seven and fourteen days, the token has demonstrated substantial performance, surpassing most cryptocurrency markets with gains of 2.5% and over 12%, respectively.

Featured image from iStock, chart from TradingView.com

Posted on

Maker (MKR) Unleashed: Price Soars 12% In One Day – What’s Behind The Surge?

In anticipation of the announcements made by the Ethereum-based Decentralized Finance (DeFi) lending platform team, the price of Maker (MKR) has experienced a remarkable surge of over 12% within hours. Now, what do these developments entail, and how will they impact the future of Maker?

Maker Empowers SubDAOs?

On August 28th, the Maker team made a significant announcement regarding their plans to introduce SubDAOs in South Korea. This move represents a critical evolution for MakerDAO, marking the “final effort” to unlock the potential of Decentralized Autonomous Organizations (DAOs). 

According to the announcements made on August 28th, introducing SubDAOs is expected to streamline, innovate, and strengthen the Maker ecosystem, paving the way for increased opportunity and growth.

SubDAOs, which stands for Subsidiary Decentralized Autonomous Organizations, are expected to play a pivotal role in the next phase of MakerDAO’s development. These entities will leverage liquidity allocation from the Maker Protocol, exploring various yield opportunities across the financial landscape. 

From decentralized finance protocols to real-world asset solutions, SubDAOs aim to harness the potential of diversified investment strategies.

Per the announcement, this presents a unique opportunity for Korean crypto leaders to engage with the forefront of DeFi developments. Participants will have the chance to be part of forming their own SubDAO or contribute to existing ones. 

This involvement offers insights into the success story of Spark Protocol, the first yield product incubated by a future SubDAO. Spark Protocol has demonstrated significant achievements, such as boasting high liquidity, industry-leading borrowing fees, and managing hundreds of millions in liquidity.

Additionally, the event encourages forging connections between leaders in centralized finance (CeFi) and decentralized finance. These connections are expected to help bridge the South Korean community to SubDAO token acquisition and farming opportunities, fostering collaboration and growth within the ecosystem.

The move into SubDAOs signifies MakerDAO’s commitment to cultivating innovation across the industry. Participants can explore “cutting-edge” decentralized finance protocols and real-world asset solutions. 

The MRK Rally, How Close To A New Annual High?

The recent announcements have sparked a surge in MKR’s price, following a decline that began on August 2nd, which coincided with the token reaching its yearly high of $1,371. 

Subsequently, MKR experienced a drop, reaching a low of $984 and breaching the significant psychological level of $1,000 and its 50-day Moving Average (MA), which had previously provided substantial support for the token.

However, with the recent announcements and the excitement surrounding the protocol’s new phase and increased liquidity entering its ecosystem, MKR has surged by an impressive 12% within 24 hours. 

Currently, MKR is trading at $1,170, surpassing and regaining its 50-day MA, which has played a pivotal role in driving Maker’s rallies throughout the year. Moreover, according to Token Terminal data, MakerDAO’s Total Value Locked has reached $5.16 billion, indicating a 3.03% uptrend in recent days.

Considering these developments, the question arises: Is MKR poised to reach a new yearly high? 

During MRK’s rally, the token reached as high as $1,230 but encountered a strong resistance wall at that level. However, suppose the protocol’s developments continue to attract liquidity, and MKR bulls can defend its 50-day MA as support, while further consolidating above the $1,260 level.

In that case, there is a possibility that, in the coming months, MRK could achieve a new yearly high above $1,375 and even touch the $1,400 level, a threshold not reached since May 2022.

Maker

Featured image from iStock, chart from TradingView.com

Posted on

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

Posted on

Maker DAO Shows Bullish Sentiment After A While, Eyes $800?

  • MKR trades below 50 and 200 EMA on the daily timeframe. 
  • Price breaks out of a falling wedge with eyes set on key resistance of $800.
  • The price looks strong on low and high timeframes.

Maker DAO (MKR) price has had a rough time recently as price beaks out of falling wedge on the daily timeframe against tether (USDT). Despite being a major player in the crypto industry, the price of Maker DAO (MKR) has struggled to replicate its run to a high of $8,000. (Data from Binance)

Maker DAO (MKR) Price Analysis On The Weekly Chart 

The price of MKR has had a fantastic run, with such movement from a low of $750 to a high of $8,000 in a matter of weeks, creating a sense of surrealism in the hearts of traders and major crypto players.

Despite such a run, the bear market has had an impact on MKR’s price, which has fallen from $8,000 to $600, a drop of more than 70% from its all-time high.

The price of MKR rallied from its weekly low of $600 to a high of $1,100 before failing to break above that region to higher heights and falling to a low of $650.

MKR’s price must break and close above $1,100 in order to have a better chance of trading higher. The price of MKR has formed a downtrend line, which is acting as resistance; flipping the area of $1,100, which is acting as weekly resistance, into support will signal a more relief bounce for the price of MKR.

If the price of MKR fails to break through this key resistance region, the price of MKR may retest the $600 support and demand zone for more buy orders.

Weekly resistance for the price of MKR – $1,100

Weekly support for the price of MKR – $650.

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

The daily timeframe for MKR prices looks promising, as prices broke out of a falling wedge, indicating a shift from a downtrend to an uptrend. With this volume from MKR prices, we could see them retest their daily resistance of $800.

On the 1D timeframe, MKR is currently trading at $681, below the 50 and 200 Exponential Moving Averages (EMA), which act as resistance. The resistance levels of the 50 and 200 EMAs are represented by the prices of $790 and $1,200, respectively.

The price of MKR needs to flip the $1,000 resistance into support to signal a relief bounce as the price of MKR has kept trading at its daily low.

The Relative Strength Index (RSI) for MKR is above 40 on the daily chart, indicating low buy order volume. 

Daily resistance for the MKR price – $800.

Daily support for the MKR price – $600.

Featured Image From Market Periodical, Charts From Tradingview

Posted on

MakerDAO Could Replace Governance Token, Will It Provide Enhanced Incentives?

According to a post on the MakerDAO Forum, the financial service protocol could replace its governance token MKR with a new token called stkMKR. The proposal was introduced to address the criticism around MKR’s tokenomics.

Related Reading | Will Ethereum Give In To Bears?

New MKR tokenomics could supplement and improve on previous benefits and incentives. The proposal emphasized that stkMKR will preserve MKR’s current burn mechanism and will allow users to claim their reinvest dividends and other payouts without spending funds on gas while keeping its tax efficiency.

On previous tradeoffs, stkMKR will attempt to attract more attention to the Maker and the MakerDAO by strengthening its narrative. This could potentially impact the price of its new governance token by attracting more users, and by updating some of its key components. The proposal claims:

A new token, stkMKR, will replace MKR as the core governance token of MakerDAO. stkMKR will be non-transferable, and represents MKR staked in governance. Staked tokenholders will receive a share of MKR tokens purchased through surplus auctions, so stkMKR will be backed by an increasing amount of MKR over time (automatically compounding like xSUSHI).

Moreover, the proposal claims the MakerDAO will become more resilient to potential bad actors and malicious proposals and improve incentives for investors. Currently, the protocol provides rewards to users via buybacks and burn returns, but the new proposal will try to create more incentives for those users “providing excess value”.

As the post claims, stkMKR and its mechanism were inspired by the Cosmos governance model, and by the tokenomics around tokens stkAAVE and xSUSHI. The proposal added:

Withdrawing from stkMKR requires waiting through a pre-set unbonding period, which improves protocol resilience and governance security (similar to Cosmos and stkAAVE).

In addition, the proposal contemplates a portion of MKR in the protocol would be diverted from the burning mechanism directly into stkMKR holders, and combine with another pool that would “smooth out yield volatility” and support Maker in difficult times, as seen below.

Source: MakerDAO Forum
MakerDAO And The New Tokenomics

A lot of protocols have been trying to update and improve their tokenomics and governance model. The DeFi sector has seen a surge in competitive environments. From Solana to Terra, Avalanche, Cosmos, and others, veteran protocols like Maker need to remain competitive.

The proposal seeks to motivate users to participate in the new governance model by improving staking rewards and delegation rates. Also, the proposal seeks to increase the MKR’s value with “concrete APR figures and supply restriction” and increase protection against volatile periods in the market while preventing credit losses.

If approved, the proposal will change the following components of the MakerDAO governance model: migration, which involves voting and contract delegation, conditional delegation, and disaster recovery. The proposal claims:

These changes will reduce the overall buyback yield attributable to all circulating MKR, while offering a new yield source specific to staked MKR. This should increase stkMKR effective yield at the expense of unstaked MKR.

The proposal is currently being discussed by the Maker community and will proceed to more formal voting if it receives positive feedback.

Related Reading | Cake DeFi Launches A $100 Million Investment Arm To Foster Web3 And Gaming Development

At the time of writing, MKR trades at $182 with a 2.23% profit on the daily chart.

MKR trends to the downside on the daily chart. Source: MKRUSDT Tradingview