MakerDAO’s Spark Protocol moves ahead, but is it enough for MKR?

Journalist

Posted: November 26, 2023

• MakerDAO’s Spark Protocol noticed loads of progress.
• The general DAI provided declined as MKR’s worth fell.

Regardless of market uncertainty, the MakerDAO [MKR] protocol has continued to see progress. One of many many causes for the expansion of the protocol has been the success of its cash market protocol.

Spark performs a key function

Spark Protocol is a cash market protocol centered on DAI. It brings collectively liquidity from MakerDAO and integrates vertically with a number one DeFi protocol.

Latest information confirmed Spark Protocol main the lending market, with over $629 million in lively loans, making up about 10% of the lending market.

.@spark_protocol_ has been dominating the lending market over the previous month.

Over $629M in lively loans and ~10% of the lending market. pic.twitter.com/pU6z0LDBfi

— Emperor Osmo (@Flowslikeosmo) November 26, 2023

Spark Protocol’s current dominance within the lending market, particularly with a concentrate on DAI, is prone to impression MakerDAO and DAI in notable methods.

With so many lively loans, Spark instructions about 10% of the lending market, doubtlessly shifting dynamics in favor of other lending platforms. Customers searching for various choices could discover Spark Protocol interesting attributable to its distinctive mixture of liquidity sources.

DAI provide declines

The DAI provide, which was round 5.6 billion in late October, dropped to about 5.3 billion as of press time. Folks appear to be shifting away from holding balances within the DSR, presumably searching for higher yields in different stablecoins.

What’s the present state of legacy finance and crypto markets?

What @MakerDAO exposures are necessary to watch?

This thread highlights key findings from the November version @BlockAnalitica’s “Market Situations and Competitors Evaluation” analysis product.

1/19

pic.twitter.com/oqTKCr9DUd

— Block Analitica (@BlockAnalitica) November 21, 2023

Some choices embrace lending markets with larger charges and positions in perp and futures foundation.

Supply: Makerburn

Whereas ETH and wstETH vaults have been used steadily, there’s been a rise in whole ETH debt attributable to extra borrowing at Spark. WBTC core vaults have additionally grown from 76 million to 86 million in whole DAI publicity.

With DAI provide lowering and extra individuals shifting to risky belongings, the liquidity ratios for stablecoins are happening. PSM and Coinbase Custody balances now make up 11.4% of circulating DAI, down from 18.8% final month.

Is your portfolio inexperienced? Try the MKR Profit Calculator

This could possibly be a priority, and Maker would possibly must take motion like adjusting borrowing charges or recalling funds if liquidity ranges fall additional.

Context: Maker Dashboard

At press time, MKR was buying and selling at $1,459.76. Its worth had declined by -0.59% within the final 24 hours. The community progress of MKR had additionally fallen. This confirmed that new addresses weren’t displaying curiosity in MKR.

Supply: Santiment