Does MakerDAO’s announcement hint at wedding bells for TradFi, DeFi


The word “DAO” got off on the wrong foot with the crypto community, but eventually shed its hacker image and became recognizable as a future-facing trend. Now, an announcement from MakerDAO has the potential to again change what a DAO can, or can’t do.

Do you DAO-t my word?

MakerDAO shared that a US-based bank had submitted an application in order to onboard collateral. The application stated,

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“A Trust Agreement will establish The Multi-Bank Participation Trust for the benefit of MakerDAO as a separate, bankruptcy-remote entity, with a regulated Delaware Corporate Trustee who will verify that all material actions of the Trust are carried out in accordance with MKR votes.”

In simple English, please? Well, this just means that the bank wants to enter into a Master Purchase Agreement with MakerDAO, for a participation trust. However, MakerDAO’s governance community members need to vote in favor of this, for the proposed TradFi x DeFi integration to take place.

More information about the role of the DAI stablecoin in the arrangement will likely come if the proposal goes through.

Don’t DAO-k my pay

There are plenty of DAOs in the sea, so why is MakerDAO so special? And was it the right choice for this venture? Let’s take a look at what the metrics have to say.

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At press time, MKR was trading at $2,004.74, having fallen by 0.16% in the past 24 hours. What’s more, transaction volumes at press time were also on the fall, in spite of MKR’s strong rally since mid-March.

That said, the 30-day MVRV ratio of the token turned positive. This is a good sign for bulls, as it hints that investors are, on average, seeing profits. However, the MVRV ratio was slipping around press time, which could signal a fall in price.

Source: Santiment

Yet, an encouraging sign is that development activity is swinging high. When technical builders and creators add more to a project, this demonstrates faith in its chances of becoming a long-term success. Here, a nearly vertical rise in dev activity bodes well for adoption and benefits both MKR and DAI.

Source: Santiment

Finally, the Adjusted Price DAA Divergence metric was flashing green “buy” signals, which most potential investors would take to be an invitation. However, the best time to buy the dip came sometime in late January. In March, the green bars have been on the fall and are turning darker, suggesting that a change could be on the way.

Source: Santiment




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