Crypto Lending Protocol MakerDAO Approves Transferring a Maximum of $500M in USDC to Coinbase Custody for 2.6% Yield
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Krisztian Sandor is a reporter on the U.S. markets team focusing on stablecoins and institutional investment. He holds BTC and ETH.
Join the most important conversation in crypto and Web3 taking place in Austin, Texas, April 26-28.
Crypto lending protocol MakerDAO approved opening a real world asset (RWA) vault for Coinbase Custody and the transfer of up to $500 million in USDC stablecoins, according to a vote concluded on Thursday.
The U.S.-based crypto exchange’s custodial arm will pay a 2.6% annual yield on deposits, a related post on Maker’s governance forum said. The proposal forbids Coinbase Custody to rehypothecate – lend, reinvest or use in other ways – the assets in the account.
Coinbase must keep the tokens in cold crypto wallets, the Maker community favored in a parallel vote. Maker will be able to withdraw funds from the vault within 24 hours, and funds in cold storage are insured up to the $500 million limit.
Maker, one of the largest decentralized lending protocols, is led by a decentralized autonomous organization (DAO), in which holders of its native maker (MKR) token vote on proposals. The protocol also issues the $5 billion DAI stablecoin, backed by some $7 billion worth of assets in Maker’s reserves.
The latest development is part of implementing an earlier decision to transfer up to $1.6 billion USDC to Coinbase to earn yield. The platform has been pursuing a strategy to diversify its reserves and increase revenues by investing in yield-generating traditional financial assets, including U.S. Treasury bills and loans to banks.
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Krisztian Sandor is a reporter on the U.S. markets team focusing on stablecoins and institutional investment. He holds BTC and ETH.
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Krisztian Sandor is a reporter on the U.S. markets team focusing on stablecoins and institutional investment. He holds BTC and ETH.
