In a recent move, decentralized finance (DeFi) platform and stablecoin issuer MakerDAO has approved an increase in the DAI Savings Rate (DSR) from 1% to 3.49%. This change provides additional incentives for investors to opt for holding and lending DAI rather than other popular stablecoins like USDC and USDT. The decision, which takes effect on June 19, comes as Maker undergoes significant transformations, including rearranging their DAI stablecoin’s backing assets.
Led by a decentralized autonomous organization (DAO), MKR token owners can vote on various proposals. In line with recent changes, Maker has started investing in real-world assets such as short-term U.S. government bonds in order to boost revenues. A portion of these revenues is then redistributed to users through the DSR. According to treasury management provider Karpatkey, this increase in DSR is significant as it not only spurs higher yields from lending stablecoins but also makes leverage more expensive.
Furthermore, Karpatkey noted that the proposal also involves hiking fees on cryptocurrency assets for taking out a DAI loan. This implies that Maker is now positioning itself as a bridge to real-world asset (RWA) yield instead of being just a platform for leveraged long traders.
Apart from adjusting the DSR, the executive vote also included several other proposals that impact the composition of DAI’s backing reserve assets. For instance, the community voted to remove Paxos Dollar (USDP) from the reserve by reducing its debt ceiling to zero. This decision has significant implications for fintech firm Paxos, as Maker currently holds approximately 50% of USDP’s $1 billion supply.
Additionally, MakerDAO voters approved onboarding the Blocktower Andromeda RWA vault. This would allow the additional purchase of up to $1.28 billion in U.S. Treasuries for the reserve, indicating a larger role for traditional financial assets in DAI’s reserve.
In a separate poll, MakerDAO voters also decided to limit Gemini Dollar (GUSD) in the reserve to $110 million, down from $500 million. This move could potentially jeopardize GUSD’s future, given that Maker holds 88% of the token’s supply.
To sum up, the latest decisions made by the MakerDAO community indicate a significant shift in their strategic focus. By revising the DAI Savings Rate and reshuffling DAI’s reserve assets, Maker aims to establish itself as a bridge connecting the cryptocurrency world to real-world assets. However, this move also impacts the standing of other stablecoins such as USDP and GUSD in the market, raising questions about their future.
Source: Coindesk
