A skyrocketing utility statistics coming out of Maker, a peer-to-contract lending platform, has increased its governance token MKR’s bullish appeal among analysts.
Chris Burniske, one of the partners at venture capitalist firm Placeholder in New York, highlighted the steadily growing locked value inside the Maker liquidity pool. The fund manager further presented that MKR as an undervalued token, for it didn’t receive the same increased investment as other tokens in the decentralized finance space.
“People mostly sleeping on MKR while utility goes through the roof, and conversations abound around its value capture model,” tweeted Mr. Burniske on Thursday.
Maker is approaching $2 billion in Total Value Locked. Source: DeFiPulse
As of this week, the Maker TVL grew towards $2 billion, its highest to date. The capital largely came in the form of USDC deposits. It comprised only 0.6 percent of TVL at the start of September. But by the end of the month, its share surged to 20 percent (around $400 million).
Restoring DAI Peg
Data aggregator platform Messari credited the Maker governance for the higher capital influx.
The US-based crypto indexing portal wrote in a report that Maker developers restored the Dai peg that means they can now ensure “incentivizing stablecoin-collateralized debt with higher debt ceilings and lower liquidation ratios.”
Making debt creation less costly allowed people to mint Dai by allocating cheaper resources. That promised to increase the stablecoin’s demand while putting downward pressure on its price. It is particularly essential when Dai becomes a target of mad-rush by yield farmers.
Dai supply and the impact of liquidity mining projects' launches on it. Source: Messari
They lock Dai in others’ liquidity pools, thereby pushing its…