MakerDAO Votes to Raise U.S. Treasury Bond Holdings to $1.25B

Maker’s governance community has approved a preliminary vote to increase its U.S. Treasury bond holdings to $1.25 billion, marking a significant increase from its current $500 million holding.

The proposal was first introduced in October 2022 through an improvement proposal called MIP65, which allowed Maker to invest in U.S. Treasury bonds. The latest proposal increases the debt ceiling for those investments, which will allow Maker to invest more in liquid bonds.

If fully approved in a later vote, Maker will spend the $750 million made available through the proposal on U.S. Treasuries, with maturities split equally over six months.

Notable voters included GFX Labs, the London Business School Blockchain, Flipside Crypto, and ConsenSys.

The proposal to raise the debt limit was passed with 77.13% of votes in favor of the change and 22.86% against it. Maker governance still needs to approve the change in a separate executive vote, which will be directly deployed to Maker Protocol.

Maker’s decision to invest in Treasury bonds comes after its decentralized stablecoin, DAI, briefly lost parity with the dollar. DAI fell to $0.89 on March 11 before recovering to $1.00 on March 13 due to the collapse of Silicon Valley Bank.

To diversify from USDC, the project will invest a portion of the USDC in its PSM to acquire the $750 million of Treasury bonds slated for purchase.