News

MakerDAO Vote To Deposit 1.6 Billion USDC For Profit In Coinbase’s New Program

MakerDAO is voting on a new proposal to move approximately 1.6 billion USDC to Coinbase Custody for revenue. Nearly 90% of the community agreed. If approved, Coinbase could benefit greatly from this program.

Stablecoin issuer DAI MakerDAO is voting on a new proposal, “Producer Improvement Proposal 81,” which proposes to move about $1.6 billion in USDC to Coinbase Custody to earn revenue, according to MakerDAO, according to a report. community announcements.

The ongoing vote ends Oct. 24, and as of press time, 88.19% of voting MKR tokens are in favor of approval. The voting results of these polls will be final on October 24th, 16:00 UTC.

Under the proposal, MakerDAO will use the 1.6 billion USDC to participate in Coinbase’s USDC Institutional Rewards program, after which Maker Governance will have access to near-instantaneous (<6 minutes) mint, burn, settlement, and withdrawal functions on Coinbase Prime. Coinbase will calculate rewards on a monthly basis from the weighted average of assets on the platform. Rewards are to be paid out the fifth business day, a month after the calculation and Maker will pay Coinbase zero custody fees.

“According to the rewards schedule proposed by MIP81, the implementation of this proposal would represent ~15 million USDC in annual revenues for MakerDAO,”

MakerDAO tweeted

A Maker Improvement Proposal submitted by Coinbase in September laid out how a chunk of USDC could be moved to Coinbase Prime for custody and rewards. “Coinbase is uniquely located to offer a USDC Rewards Program to MakerDAO that meets this evaluative criteria,” according to the proposal.

Coinbase Global will benefit significantly from a potential transfer of approximately $1.6 billion in USDC from MakerDAO to Coinbase Prime, Oppenheimer analyst Owen Lau said in a research note to clients.

Coinbase is one of the co-issuers of USDC, along with Circle. The transfer between Coinbase and MakerDAO is part of Maker’s ongoing effort to allocate about $4 billion in USDC from its treasury to institutional investors in order to diversify its balance sheet and earn some yield.

Earlier in October, Maker invested $500 million in U.S. treasuries and corporate bonds.

DISCLAIMER: The Information on this website is provided as general market commentary and does not constitute investment advice. We encourage you to do your own research before investing.

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