Savings DAI Surpasses $1B TVL, But DAI Remains In Decline – Crypto News – Crypto News
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Savings DAI Surpasses $1B TVL, But DAI Remains In Decline Savings DAI Surpasses $1B TVL, But DAI Remains In Decline

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Savings DAI Surpasses $1B TVL, But DAI Remains In Decline – Crypto News

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Savings DAI, the yield-bearing version of MakerDAO’s decentralized stablecoin, has surpassed a total value locked of $1B.

The news was announced by SparkDAO, a DAI-based lending market and the first MakerDAO subDAO. sDAI tokens accrue interest provided by the DAI Savings Rate, with yields programmed to fall as adoption increases. SparkDAO governs Savings DAI.

“In spite of challenging market conditions, Maker and Spark have experienced impressive growth and garnered significant interest from the DeFi community,“ said Sam MacPhenson, the CEO of Phoenix Labs, the team behind Spark Protocol.

Spark Protocol currently boasts a total value locked of $440M, ranking as the fifth-largest DeFi protocol, according to DeFi Llama.

Mixed results

In early August, MakerDAO increased DSR yields to 8% in a bid to bolster DAI adoption and reverse its long-term decline in market cap. The move followed an increase from 1% to 3.3% in May.

While the rate hike quickly ramped up the adoption of Spark Protocol and sDAI, Rune Christensen, MakerDAO’s founder, recommended capping DSR yields at 5% within 48 hours of upping returns.

According to Dune Analytics, the total value locked (TVL) in Maker’s DSR is $1,65B, up 1,170% since June 19, while the circulating supply of DAI is down 13.6% over the same period. The continued decline in the market cap of DAI despite the rate hike shows existing DAI holders make up the lion’s share of sDAI holders, rather than new users.

DAI’s capitalization is also down 62% from its February 2022 all-time high at $3.8B, according to CoinGecko.

DAI market cap. Source: CoinGecko.

Nevertheless, Maker’s MKR token has enjoyed consistent price gains in recent months. MKR last changed hands for $1,452 — a 111% increase since June 30.

Spark Protocol plots multi-chain expansion

Spark Protocol is now looking to expand onto new chains within Ethereum’s broader ecosystem in a bid to find new users.

On Sept. 18, MakerDAO governance unanimously passed the preliminary poll for a proposal to deploy Spark on Gnosis Chain, an Ethereum side-chain.

Polygon also published a proposal advocating for Spark’s deployment on its flagship Layer 2 network, Polygon zkEVM, on Aug. 1. However, no progress appears to have been made on the proposal since.

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