MakerDAO closes the year with this milestone

Journalist

Posted: December 27, 2023

Of all DeFi protocols, MakerDAO has seen essentially the most income in 2023.
This comes after it witnessed a major TVL decline, and its DAI stablecoin briefly misplaced its peg.

MakerDao [MKR] has emerged because the decentralized finance (DeFi) protocol with essentially the most income in 2023, information from DefiLlama has proven.

Supply: DefiLlama

This outstanding turnaround was fueled by an increase within the protocol’s DAI stablecoin provide and its integration of real-world property and U.S. Treasury payments (T-bills), offering it with yields from rising rates of interest.

Regardless of being second to Lido Finance [LDO] in whole worth locked (TVL), Maker has surpassed Lido when it comes to income to this point this 12 months. AMBCrypto discovered that Maker’s income totaled $103 million for the reason that 12 months started.

However, Lido has generated $60 million in income throughout the identical interval.

MakerDAO’s journey to the “high”

Originally of the 12 months, Maker was displaced by liquid staking protocol Lido because the main DeFi protocol when it comes to TVL.

This was resulting from elevated Ethereum [ETH] staking exercise in expectation of Ethereum’s Shanghai Improve, which drove liquidity to the protocol.

Maker’s troubles have been additional aggravated in March when its DAI stablecoin suffered a depeg following the surprising collapse of Silicon Valley Financial institution, which resulted in USD Coin [USDC] quickly dropping its parity to the greenback.

How a lot are 1,10,100 MKRs worth today?

Earlier than this occasion, MakerDAO’s Peg Stability Module (PSM) relied considerably on USDC to assist stabilize the protocol’s DAI stablecoin at $1. In January, $2.4 billion of USDC backed DAI throughout the PSM, in response to information from DefiLlama.

Nonetheless, following USDC’s transient depeg in March, which critically impacted DAI, inflicting it additionally to lose its greenback parity and pushing down its provide, Maker diminished its reliance on the stablecoin. By June, this had dropped by nearly 80%.

Because the 12 months progressed, Maker’s real-world property (RWAs) vertical grew. These are on-chain variations of property in conventional finance. Examples embody actual property, bonds, shares, commodities, invoices, commerce receivables, and so forth.

Over 65% of Maker’s charge income by October got here from its RWAs. Nonetheless, by the top of October, the income it acquired from tokenized T-Invoice merchandise began to rally, dwarfing that which got here from RWAs.