Key Takeaways
- The popular decentralized organization, MakerDAO (MKR), has pulled off a partnership deal with Coinbase
- This partnership will see a transfer of $1.6bn of its USD Coin (USDC) reserves to Coinbase to generate a profit of up to 1.5%
The popular decentralized organization, MakerDAO (MKR), has pulled off a partnership deal with Coinbase that will see a transfer of $1.6bn of its USD Coin (USDC) reserves to Coinbase to generate a profit of up to 1.5%. Having Coinbase custody, a segment of the MakerDAO treasury had to go through the verdict and acceptance of the MakerDAO community, and it was passed after 75% of the votes agreed to the proposition.
The $1.6 billion is just a meager one-third of MakerDAO's treasury. This fund will ensure that users stake collateral in substitution to get DAI stablecoin.
Read: XRP, ADA, and ETH Have Each Achieved Major Milestones This Year
MakerDAO partners with Coinbase to custody $1.6 billion USDC
The proposal is also referred to as MIP81. Coinbase, in the proposal, is construed as a long-established ally of Maker, and also, it is a famous, respectable, and coordinated company. This MIP unveils a comprehensible route to issuing close to 1.5% APY on USDC, set up as USDC rewards and utilizing liquidity at a cost-free and industry-outstanding security for Maker, as the proposal mentioned.
Referring to the proposal, Maker will not be saddled with the responsibility of depositing any custody fees to Coinbase. Alongside this, the community will have to hold another electoral meeting for an extension. Perhaps funds are to be stored in Coinbase's custody following a trial spell at the conclusion of 2022.
Considering all that has been appropriately drafted in the proposal, the next thing for MakerDAO is to create a fresh "legal body" that can legally stake money into Coinbase's Institutional Rewards program in lieu of the DAO. A tweet from MakerDAO revealed this.
Coinbase considers the passing of the proposal a great accomplishment considering that the sum of capital it keeps for clients will increase from the present $1.7bn, as revealed by a blog post from the company. Let us know what your thoughts are about this in the comment section.
