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MakerDAO passes proposal for $750M increase in US Treasury investments

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Lending protocol and stablecoin issuer MakerDAO passed a proposal on March 16 to increase its portfolio holdings of United States Treasury bonds by 150%, from $500 million to $1.25 billion.The proposal aims to increase the protocol’s exposure to real-world assets and “high-quality bonds,” following its Dai (DAI) stablecoin losing its $1 peg during market volatility on March 11.

The $750 million debt ceiling hike was approved by 77% of Maker’s delegates. A representative of MakerDAO told Cointelegraph: The bonds will be purchased with equal maturities, biweekly and over a six-month period, totaling 12 slots of $62.5 million each.

Under the strategy, MakerDAO said it expects to deliver a net annualized yield of 4.6% to 4.5% after custody. Maker’s revenue stream could also be boosted by trading costs, the proposal noted.The proposal would allow Maker “to take advantage of the current yield environment, and generate further revenue on Maker’s PSM Assets, in a flexible, liquid, manner,” it read.

Federal Reserve data shows that Treasury’s yields for 10-year constant maturity were at 3.64% on March 14.The move is an extension of a current $500 million U.S.

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