New Coinbase Proposal Would Boost This DeFi Protocol's Revenue By $24M Annually

New Coinbase Proposal Would Boost This DeFi Protocol's Revenue By $24M Annually

U.S. crypto exchange Coinbase Global Inc COIN has put out a new proposal that would increase Maker DAO’s MKR/USD revenue by $24 million a year.

What Happened: In a new governance proposal released on Tuesday, Coinbase proposed transferring 33% or $1.6 billion of USD Coin USDC/USD on MakerDao’s Peg Stability Module (PSM) into Coinbase’s yield-bearing account.

Maker will pay zero custody fees on the USDC held on Coinbase Prime and earn 1.5% APY in rewards on the stablecoins deposited.

Maker is a protocol built on Ethereum ETH/USD behind one of the longest-standing and most popular decentralized stablecoins DAI DAI/USD. The PSM is designed to hard-peg the price of DAI to $1.

Why It’s Important: One of the most “urgent problems” faced by Maker is its inability to invest its balance sheet correctly, said “adcv”, a member of the DeFi protocol’s strategic finance core unit.

“Which is to say, highly underinvested, with knock-on effects that reduce the protocol’s ability to take risk and its attractiveness as a stablecoin,” said adcv.

According to an image shared by adcv, Coinbase’s new proposal would make the puzzle pieces fall into place.

 

 

“We have had a long and positive partner relationship with Coinbase for many years starting with support of DAI on the exchange years ago, then with the “Dai Rewards” campaign on Coinbase that started during the Foundation time,” said a member of Maker’s growth core unit team.

“This proposal reflects that on-going relationship in one of their newest institutional products.”

Price Action: At the time of writing, MKR was trading at $717, down 4% over the last 24 hours.

Posted In: DeFi ProtocolStablecoinCryptocurrencyNewsMarkets

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