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MakerDAO to Diversify Assets by Investing in US Treasury Bonds

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MakerDAO to Diversify Assets by Investing in US Treasury Bonds

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, the decentralized finance platform, has successfully raised its investment ceiling on US Treasury Bonds from $500 million to $1.25 billion. The proposal was passed with 77% of the votes, and the firm is set to use $750 million in Protocol Synthetic Assets (PSM) to buy more US Treasury Bonds. The move is aimed at diversifying the assets that support its decentralized stablecoin, DAI.

The firm plans to purchase the bonds every two weeks over a period of six months, with a total of 12 purchases at $62.5 million each. According to the proposal, the strategy is expected to yield a net annualized return of 4.6% to 4.5% after the deduction of custody and transaction costs.

MakerDAO’s investment in US Treasury bonds is a strategic move towards mitigating risks associated with relying on a single asset to support its stablecoin. Diversification is a standard practice in traditional finance, and MakerDAO is applying the same concept to its decentralized platform.

The move is also expected to increase confidence in DAI, as investors grow more concerned about the risks associated with centralized stablecoins. DAI is a decentralized stablecoin, with no central authority that controls or mints it, making it an attractive choice for investors who desire financial independence.

The decision is also in line with the firm’s overall goal of increasing the stability and sustainability of its platform. By diversifying its assets, the firm aims to reduce risks and create a more stable ecosystem that attracts more users.

In conclusion, the move by MakerDAO to diversify its assets by investing in US Treasury Bonds is a strategic decision aimed at mitigating risks associated with relying on a single asset to support its stablecoin. The move will increase the stablecoin’s value proposition and ultimately, the sustainability of the MakerDAO platform.

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