MakerDAO Users To Hit DAI For Free After Debt Ceiling Increase

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DeFi lender’s move punctuates model overhaul

MakerDAO users can now create DAI for free.

A recent executive vote by MakerDAO raised the debt cap on its stETH vault to 200 million DAI. Maker’s wrapped stETH vault currently maintains a 0% stability fee, which means users can create a DAI against a WstETH collateral without paying fees on Maker’s position.

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Users can open a WstETH vault using the Oasis app, which was released from Maker in June 2021, or the third-party DeFi Saver dApp – which also allows users to open a WstETH vault by depositor ETH or stETH.

A collateralization ratio of at least 185% must be maintained when minting against WstETH. Users have already minted 145.5 million DAI against WstETH, leaving 55.5 million available for further minting.

Coinbase surprises MakerDAO with pitch to upload on USDC

Proposal could change Christensen’s offer to reduce reliance on centralized revenue

MakerDAO is a collateralized debt protocol, meaning users can mint its DAI stablecoin for deposits in the form of supported collateral assets. Maker is currently the largest DeFi protocol with a total value locked of $9.9 billion, according to Daistats.

The higher debt cap comes as many in the MakerDAO community are pushing for the project to reduce its reliance on backing centralized collateral assets. On September 1, Maker governance voted to reduce the fees of six vaults in an effort to promote DAI coins against decentralized collateral.

Centralized stablecoin

USD Coin, the centralized stablecoin, is DAI’s largest source of support, accounting for more than a third of Maker’s TVL. Concerns about Maker’s high exposure to USDC were amplified last month when Center, the US consortium behind USD Coin, blacklisted 38 addresses holding 75,000 USDC that were associated with Tornado Cash after the Department of US Treasury sanctioned mixing service.

In late August, MakerDAO founder Rune Christensen proposed a plan to limit exposure to real-world assets to 25% and float DAI against the dollar over the next three years.

But not everyone in the MakerDAO community is convinced by Christensen’s plan, with Maker’s Core Growth Unit trading a proposal from Coinbase to pay a 1.5% return on up to $1.6 billion. USDC from Maker.

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