DeFi Lender’s Move Punctuates Overhaul of Model
MakerDAO’s users can now mint DAI for free.
A recent MakerDAO executive vote raised the debt ceiling for its stETH vault to 200M DAI. Maker’s Wrapped stETH vault currently maintains a 0% stability fee, meaning users can create DAI against WstETH collateral without paying any fees on the position to Maker.
Users can open a WstETH vault using the Oasis app, which spun out of Maker in June 2021, or the third-party DeFi Saver dApp — which also lets users open a WstETH vault by depositing ETH or stETH.
A collateralization ratio of at least 185% must be maintained when minting against WstETH. Users have already minted 145.5M DAI against WstETH, leaving 55.5M available for further minting.
Coinbase Surprises MakerDAO with Pitch to Load Up on USDC
Proposal Could Change Christensen’s Bid to Lessen Reliance on Centralized Revenue
MakerDAO is a collateralized debt protocol, meaning users can mint its DAI stablecoin against deposits in the form of supported collateral assets. Maker is currently the largest DeFi protocol with a total value locked of $9.9B, according to Daistats.
The higher debt ceiling comes as many in the MakerDAO community are pushing for the project to reduce its reliance on backing from centralized collateral assets. On Sep. 1, Maker governance voted to reduce the fees for six vaults in a bid to promote DAI mints against decentralized collateral.
USD Coin, the centralized stablecoin, is DAI’s largest source of backing, representing more than a third of Maker’s TVL. Concerns regarding Maker’s heavy USDC exposure amplified last month when Centre, the U.S.-based consortium behind USD Coin, blacklisted 38 addresses holding 75,000 USDC that were associated with Tornado Cash after the U.S. Treasury Department sanctioned the mixing service.
In late August, MakerDAO founder, Rune Christensen, proposed a plan to limit exposure to real-world assets at 25% and float DAI against the dollar within the next three years.
But not everyone within the MakerDAO community is convinced by Christensen’s plan, with Maker’s Core Growth Unit negotiating a proposal from Coinbase to pay a 1.5% yield on up to 1.6B of Maker’s USDC.