Maker prices rise to an all-time high as the community prepares for MakerDAO to become completely decentralized.
Stablecoins have become an important platform for the crypto sector as they serve as a highly liquid base pair for most coins, and also provide investors with a safe place to go. to make a profit. The data also shows that stablecoins play a key role in acting as a gateway to capital inflows into the crypto ecosystem.
While the largest stablecoins on the market are currently controlled and issued by centralized institutions like Tether or Circle. The DAI and its publisher Maker (MKR) is one of the stablecoin projects that adhere to the decentralized features that the crypto community expects.
Data from TradingView shows that MKR prices have risen almost 100% over the past week, rebounding from $ 2,011 on April 7 to an all-time high of $ 4,102 early this morning due to increased trading volume. strong.
Motivation for MKR has increased in recent weeks as the ecosystem focuses on making the protocol completely decentralized and community-regulated.
Governance has emerged as one of the most sought-after features in the 2021 bull market, as part of the broader DeFi movement. MakerDAO offers one of the most active governance experiences in the cryptocurrency sector.
“As the community prepares for full decentralization, these are the key ingredients for creating a self-sustaining MakerDAO.”
Holding the MKR is a must to participate in protocol management. More and more governance proposals for voting have led to higher demand for MKR, pushing its prices higher.
Demand for DAI drives Maker prices up
As mentioned before, one of MakerDAO’s main tasks is to manage the stablecoin DAI, which has seen a significant increase in total supply in 2021 as it gets better, algorithmically controlled. in maintaining its exchange rate with the US dollar.
The growth in DAI supply is partly due to its use over several DeFi protocols including AAVE, Compound (COMP) and Cream Finance (CREAM) as a suitable choice for a decentralized stablecoin.
New DAI is created by locking collateral like Ethereum (ETH) or ChainLink (LINK) into MakerDAO’s vault and generating DAI based on that.
Due to this mechanism, the supply of DAI is increasing concurrently with the increase in the total locked value (TVL) in the Maker protocol, making the project the second DeFi protocol after Compound with a TVL of $ 9.28 billion. la.
As TVL on MakerDAO steadily increases with DAI supply, fundamental metrics including an increase in social media activity begin to signal an approaching upside price move.
With altcoins now moving again and the DeFi sector warming up as evidenced by increased ecosystem-wide TVL, MakerDAO could go even higher as it is the top choice for investors wants to interact with DeFi protocols based on the Ethereum network.