MakerDAO is considering $1.25 billion investment in US Treasuries

MakerDAO is considering raising the cap on its government bond holdings to $1.25 billion. A proposal was submitted on March 6, saying it would help take advantage of the current yield environment.

DeFi powerhouse MakerDAO is considering expanding its investments in United States government bonds to $1.25 billion. A new proposal was submitted on March 6, calling for the $500 million cap to be raised. The $750 million raise will be implemented through a 6-month US Treasury ladder strategy with bi-weekly rollover.

A decision to allocate $500 million to Treasury funds was first announced in June 2022, making headlines. This time, the motivation for this was stated as follows:

“ [to] take advantage of the current yield environment and generate further income on Maker’s PSM assets in a flexible, liquid manner that allows for material adjustments and upgrades as may be required under applicable, relevant Maker RWA-related policies.

It was noted at the time that it could help Maker reduce counterparty and credit risk, which was necessary given the turmoil in the market. Maker hopes this allocation will happen as soon as possible so that it can “take maximum advantage of the current revenue environment.”

Maker’s Treasury Bond investments are raising eyebrows

Maker made huge headlines when it announced it would allocate $500 million in government and corporate bonds. The DAO ultimately decided to allocate $400 million to US Treasury bonds and $100 million to corporate bonds.

There was some criticism of the decision, with opponents saying it was not really in line with the spirit of decentralization. ShapeShift founder Erik Voorhees was one of those who did criticized the decision.

MakerDAO takes several steps forward

Maker marches on and remains one of the most powerful entities in the DeFi space. The MakerDAO community rejected an offer from Cogent Bank to borrow $100 million from its platform, with 73% voting against. Interestingly, the community had approved a similar loan to another bank, the Huntingdon Valley Bank, bringing more traditional financial entities on board.

Last month, the MakerDAO community set aside 5 million DAI for a legal defense fund. It stated that the fund would cover aspects of legal defense that traditional insurance would not cover.

It also announced an Aave competitor called Spark Protocol last month. The latter will use DAI for liquidity and offer a loan product as a first offering. In other news, it recently sparked discussions for a proposal that would allow DAI to borrow from MKR tokens.


BeInCrypto has reached out to the company or individual involved in the story to get an official statement on recent developments, but it has not yet heard back.

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