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MakerDAO Expands its Investment Portfolio to Diversify DAI’s Assets.

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MakerDAO Expands its Investment Portfolio to Diversify DAIs Assets.

It is reported that, according to official news, MakerDAO’s proposal to raise the investment ceiling of US treasury bond bonds from US $500 million to US $1.25 billion has been passed. This proposal won 77% of the votes. MakerDAO will use USD750 million in PSM to purchase more US treasury bond bonds, thus diversifying the current assets supporting DAI. These bonds mature every two weeks and will be purchased a total of 12 times over a six-month period for $62.5 million each. According to the proposal, the strategy expects a net annualized yield of 4.6% to 4.5% after deducting custody and expected transaction costs.

MakerDAO has approved the proposal to raise the investment ceiling of US treasury bond bonds to US $1.25 billion

Analysis based on this information:


MakerDAO, a decentralized finance (DeFi) protocol, has reportedly passed a proposal to raise the investment ceiling of US treasury bonds from US $500 million to US $1.25 billion. This decision was made after receiving 77% of the votes from MakerDAO’s community members. The proposal aims to diversify the current assets supporting DAI, a stablecoin that MakerDAO issues.

To achieve this, MakerDAO plans to use USD750 million in Protocol DAI Savings Rate (PSM) to purchase more US treasury bond bonds. The purchased bonds will mature every two weeks and will be bought a total of 12 times over a six-month period for $62.5 million each. The aim is to achieve a net annualized yield of 4.6% to 4.5%, after deducting custody and expected transaction costs.

Diversification is an important strategy for any investment portfolio, including DeFi protocols like MakerDAO. By investing in US treasury bond bonds, MakerDAO seeks to achieve stable returns while minimizing the risk of volatility that often plagues cryptocurrencies. US treasury bonds are some of the safest securities in the world and are considered a “risk-free” asset.

Additionally, the decision to invest in bonds supports MakerDAO’s goal of maintaining a stable peg for its stablecoin, DAI. The stability of DAI is important for users who rely on it for everyday transactions and as a store of value. If DAI’s value fluctuates too much, it could deter users from utilizing it, potentially leading to a collapse of the protocol.

In conclusion, MakerDAO’s decision to expand its investment portfolio to diversify DAI’s assets can be seen as a wise move. Investing in US treasury bond bonds provides stable returns and minimizes the risk of volatility, which aligns with MakerDAO’s goal of maintaining a stable peg for DAI. The move could also attract more users to the protocol, leading to increased adoption and growth in the DeFi space.

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