MakerDAO (MKR) has introduced that Spark Protocol is integrating Rocket Pool’s staked Ethereum (rETH) as a brand new sort of collateral, creating elevated alternatives for customers to leverage their digital property within the DeFi ecosystem.
Broaden the lending ecosystem
Based in 2015, MakerDAO is greatest recognized for issuing the decentralized stablecoin, DAI. The most recent growth from its partnership with Spark Protocol permits customers to make use of their rETH holdings as collateral to borrow DAI at aggressive charges, whereas concurrently incomes staking yield.
Rocket Pool (RPL) is a decentralized Ethereum staking pool that gives rETH customers, a tokenized model of staked Ethereum. With over 740,000 ETH at present invested within the protocol, the addition of rETH as a sort of collateral on the Spark protocol reinforces MakerDAO’s dedication to offering numerous collateral choices to borrow its DAI stablecoin.
Sam MacPherson, CEO of Phoenix Labs, the primary contributor to the Spark protocol, hailed the event as a step ahead for Ethereum’s liquid staking choices.
McPherson mentioned:
“This not solely diversifies Ethereum’s liquid staking choices, but additionally strengthens the decentralization and safety of our system. For DeFi customers, this offers one other option to borrow DAI and benefit from key rates of interest because of Spark’s distinctive place to acquire liquidity instantly from the Maker Protocol line of credit score.
Embedding rETH as collateral coincides with Maker Governance’s determination to extend the quantity of DAI that Spark Protocol can borrow, furthering the symbiotic relationship between the 2 DeFi platforms.
Launched in Could, Spark Protocol rapidly made a reputation for itself offering the infrastructure for Spark Lend, a DAI-focused decentralized lending market. Along with facilitating direct borrowing of DAI in opposition to numerous property, customers can even deposit ETH, earn charges, benefit from the just lately elevated DAI Financial savings Fee (DSR), and commerce stablecoins resembling DAI or USDC with out slippage .
MakerDAO’s real-world asset technique
This enlargement comes as MakerDAO continues to bolster its personal Treasury holdings with US authorities debt. In current months, MakerDAO has elevated its holdings of US Treasuries by $500 million to $1.2 billion, marking a strategic pivot to lower-risk conventional property as a option to diversify its collateral pool.
The choice to broaden MakerDAO’s publicity to real-world property was made following an incident the place its stablecoin, DAI, momentarily misplaced parity with the US greenback. This transfer to diversify its holdings is seen as a part of MakerDAO’s broader technique to turn out to be extra resilient to market volatility.
Allan Pedersen, CEO of Monetalis Group, which carried out the bond buy on behalf of MakerDAO, described the choice as a “stable, dependable and versatile answer” that can generate extra income for the protocol.
