MakerDAO increases DAI savings rate, removes Paxos Dollar, limits Gemini Dollar in reserve.
The MakerDAO community has approved a proposal to increase the reward for investors who hold its $4.5 billion DAI stablecoin and to change the assets that back DAI. The decision was made through an executive vote on Thursday, and the DAI Savings Rate (DSR) will be increased from 1% to 3.49%, providing additional incentive for investors to hold and lend DAI instead of other stablecoins like USDC and USDT. MakerDAO is a decentralized finance (DeFi) platform and stablecoin issuer that is led by a decentralized autonomous organization (DAO) where MKR token owners can vote on proposals. The platform is currently undergoing a major transformation, including rearranging the backing assets of the DAI stablecoin. Maker increasingly invests in real-world assets such as short-term U.S. government bonds to boost revenues, redistributing a part of it to users through the DSR. This decision will take effect on June 19.
The executive vote also included other proposals that would influence the composition of DAI’s backing reserve assets. The community effectively removed Paxos Dollar (USDP) from the reserve by approving a decrease in its debt ceiling to zero. The move has a substantial impact on fintech firm Paxos’ stablecoin, as Maker currently holds roughly half of USDP’s $1 billion supply. The vote also ratified onboarding the BlockTower Andromeda RWA vault that would allow the additional purchase of up to $1.28 billion in U.S. Treasuries for the reserve. In a separate poll, MakerDAO voters also favored reducing Gemini Dollar (GUSD) in the reserve to $110 million from $500 million. As a result, GUSD’s future could be jeopardized as Maker holds 88% of the token’s supply.