MakerDAO snaps up more US Treasury bonds

MakerDAO, the DeFi protocol whose team is responsible for the creation of the DAI stablecoin, recently announced the completion of its acquisition of an extra $700 million worth of US Treasurys.

It now has a total bond allocation of $1.2 billion, the project noted in a press release.

This decision follows an earlier MakerDAO proposal which asked to increase the debt ceiling for MIP65 from $500 million to $1.25 billion to take advantage of the existing yield environment.

This strategy, designed by Monetails Group, is expected to deliver an annualized yield of 4.5%.

DAI currently has a total value locked (TVL) of $8.4 billion, and short-term bond ETFs comprise a large chunk of Maker’s existing collateral (14.8%). 

Allan Pedersen, CEO of Monetalis Group, noted that Maker’s decision to purchase additional US Treasury shares shows that it is pushing “boundaries within DeFi” and creating a “diversified portfolio approach.”

“Maker enhances the robustness of its platform and stablecoin while also generating new means of revenue to continue to attract participants to Maker and the wider DeFi ecosystem,” Pedersen said.

ETH and wstETH are the primary collateral assets utilized to back the stablecoin.

Digital asset research company ASXN noted in a tweet that stETH collateral has begun to surpass ETH as the dominant backing for DAI. The total stETH collateral recently reached 933,000.

Loading Tweet..

This shows that the dominance of liquid staking derivatives continues to remain popular following the Shapella upgrade.

---

Get the news in your inbox. Explore Blockworks newsletters:

• The Breakdown: Decoding crypto and the markets. Daily.
• 0xResearch: Alpha in your inbox. Think like an analyst.
• Empire: Crypto news and analysis to start your day.
• Forward Guidance: The intersection of crypto, macro and policy.
• The Drop: Apps, games, memes and more.
• Lightspeed: All things Solana.
• Supply Shock: Bitcoin, bitcoin, bitcoin.