MakerDAO, the issuer of an Ethereum-based stablecoin, has been approved by DAI, hoping to generate yield and provide users with what it is best known for. proposal $100 million of Circle’s USD Coin (USDC) to be used in a Yearn Finance yield generating account called the “Vault”.
The proposal, submitted on January 9, aims to find a way for MakerDAO to allocate its treasury and earn revenue.
MakerDAO to generate yield from Yearn Finance Vault
After the approval of MIP92 (Maker Reform Proposal 92), MakerDAO plans to start earning about $2 million annually in YearnFi investment of $100 million USDC to earn an annual 2% yield.
Founded by renowned DeFi developer Andre Cronje, Yearn Finance is a yield aggregator built on the Ethereum blockchain, allowing users to deposit crypto assets into the service in exchange for yield or interest over a period of time.
With a total of 95,666.284 of the maker’s native tokens, MKR dropped in the vote, about 68,462 MKR, which is 71.56%, voted in favor of deploying USDC in Yearn Finance, while 27,204 MKR, which accounts for 42.42% voted for the whole idea. and 0.0% voted “abstain”.
Although MIP 92 has been passed, the proposal to implement the concept has yet to go to the executive vote.
MakerDAO attraction to USDC
Before introducing MIP92, MakerDAO had already shown interest in Circle’s dollar-backed token, USDC. Last year, DAI stablecoin operator A huge amount has been invested Partnering with Coinbase to become the largest stakeholder in USDC.
As reported by NewsBTC, MakerDAO and Coinbase Prime have a total of USD 1.6 billion in custody, allowing both partners to earn a 1.5% return on accumulated assets. Notably, stablecoins have seen rapid growth in recognition in recent years. Consequently, investors now rely on these assets to protect the value of their investments.
Unlike traditional cryptocurrencies, which fluctuate every now and then, stablecoins are tied to the value of an underlying asset like the US dollar. Due to the nature of stablecoins, many investors have found them attractive, especially as an important part of future finance.
While USDC still lags behind USDT in adoption, the goal has always been to surpass the latter and become number one in market cap.
Returning to MakerDAO, the protocol’s native token, MKR, has also been thriving to bridge the gap between its current price and its all-time high. Over the past 30 days, MKR has risen over 20% and currently trades above $650 with a 24-hour trading volume of $22.3 million.
Featured image from BlockchainReporter, chart from TradingView
