A Loan to DAI For

The student may have become the master, and we’re not talking about Cobra Kai season 4. MakerDAO has approved a vote to form a stablecoin loan vault worth $100 million dollars… for a bank.

• The vote by Maker’s decentralized autonomous organization saw an overwhelming level of support in favor of the measure, coming in with over 87% of participants voting ‘Yes’.
• The United States-based Huntingdon Valley Bank (HVB) was approved to open a stablecoin vault which will allow MakerDAO stablecoin DAI to be borrowed only after HVB deposits off-chain assets as collateral.
• Upon launch, up to $100 million will be available to HVB with plans for the cap to rise to $1 billion throughout the next 12 months.
• MakerDAO’s spokesperson for real-world assets, Hugh Ragsdale, described the move as “an out-of-the-box, diversified and wholesale solution for generating Real World Asset (crypto-uncorrelated) revenues.”

Of course, some members of MakerDAO were not thrilled about the marriage of the decentralized finance mainstay to a traditional bank, but crypto users aren’t the only ones who need to consider diversification. It shouldn’t come as a surprise since MakerDAO also recently voted to invest $500 million into US Treasury bills as part of their diversification initiative.