1 year ago
The MakerDAO assemblage voted successful favour of keeping Gemini USD stablecoin arsenic portion of the protocol’s DAI stablecoin reserves amid concerns astir insolvency.
The MakerDAO assemblage earlier started voting connected 2 governance polls successful an effort to bounds DAI’s vulnerability to Gemini owed to the liquidity situation plaguing Gemini’s Earn program. The GUSD stablecoin tin beryllium utilized arsenic collateral to mint Maker’s DAI stablecoin.
The canvass that ended connected January 19 avoided a calamity for GUSD arsenic 50.85% of the votes supported keeping the GUSD indebtedness ceiling astatine $500 cardinal successful Maker’s Peg Stability Module (PSM), and 49.15% supported removing it completely.
MakerDAO canvass last resultPSM is simply a mechanics that allows users to mint DAI successful speech for collateral accepted by Maker. Furthermore, it keeps DAI’s peg with the U.S. Dollar. The result means that MakerDAO volition proceed to clasp 85% of each GUSD successful circulation successful its PSM.
Concerns astir GUSD
There person been concerns astir MakerDAO’s vulnerability to Gemini, chiefly with the $900 cardinal Gemini Earn assets remaining locked up with Genesis, which has suspended withdrawals. Gemini is besides nether unit aft it halted withdrawals from its yield-generating Earn program. Further, the U.S. Securities and Exchange Commission charged the exchange for alleged unregistered securities sales.
A further interest for GUSD’s worth is that it’s partially backed by currency held astatine Silvergate Capital. The embattled crypto-friendly slope is 1 of the galore firms that suffered from past year’s crypto-related meltdowns.
However, Genesis CEO Tyler Winklevoss reassured the Maker assemblage by stating the lone vulnerability MakerDAO had to Gemini was done the Peg Stability Module. In addition, the CEO assured that the GUSD reserve backing DAI stablecoin would not beryllium taxable to bankruptcy proceedings.
Maker presently has $489 cardinal successful GUSD collateral against its indebtedness ceiling of $500 million, the maximum magnitude of DAI that tin beryllium minted with the Gemini Dollar. The proposal from the Strategic Finance Core Unit notes that MakerDAO presently earns $7.3 cardinal from its vulnerability to GUSD.
The station MakerDAO approves 85% Gemini USD holdings successful DAI stablecoins appeared archetypal connected CryptoSlate.
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