Decentralized Finance (DeFi) Sees Resurgence Driven by US Treasuries, Stablecoin Yields, and Real-World Assets.
Market intelligence firm IntoTheBlock highlights the significant impact of US treasuries, stablecoin yields, and real-world assets on the resurgence of the decentralized finance (DeFi) sector. Lucas Outumuro, Head of Research at IntoTheBlock, emphasizes the positive influence of MakerDAO’s new 8% yield on the stablecoin Dai (DAI), which rapidly attracted $1 billion in deposits within a week, reigniting interest in DeFi.
The article underscores the innovative approach by MakerDAO, where the increased DAI Savings Rate (DSR) is financed by Maker’s revenues, primarily sourced from a portion of its collateral invested in US treasuries. This strategic shift is already creating an impact within MakerDAO and is expected to extend beyond the protocol.
IntoTheBlock highlights the role of exposure to real-world assets, such as treasuries, in revitalizing the DeFi space, particularly during a turbulent trading environment. The surge in DAI earning the DAI Savings Rate, along with a significant increase in DAI supply (currently at a three-month high), reinforces the trend of incorporating real-world assets in DeFi. Notably, other protocols like Ondo Finance have also made progress, with $164 million in deposits in their tokenized treasuries.
Furthermore, IntoTheBlock observes a 35% increase in Maker’s governance token, MKR, over the past month, attributed to the accumulation of large holders. While the recent price movement of MKR may be seen as potentially overheated, the implications of competitive DSR rates are only just beginning. Even if the DSR drops to 5% to match treasuries, this development opens opportunities for other lending protocols and decentralized exchanges (DEXs) to utilize a stablecoin with a sustainable yield as a foundational element.
The DAI savings rate is expected to play a pivotal role in DeFi and the broader cryptocurrency ecosystem by attracting back capital and introducing new users. As of the time of writing, MKR is trading at $1,248, representing a 1.66% increase in the last 24 hours.
Read Also: Trader Forecasts Nearly 60% Surge for Altcoin That Skyrocketed This Month
Disclaimer: The information provided in this article is for informational purposes only and should not be construed as financial or investment advice. Cryptocurrency investments are subject to market risks, and individuals should seek professional advice before making any investment decisions.
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