While this decision was ultimately determined by a single MKR whale who held enough MKR to cast 97% of the vote, the result has been a significant influx of Ethereum (ETH) into Maker’s lending protocols.
Following the first vote that lowered the stability fee by 4%, Maker held another vote this week that resulted in an additional 0.5% reduction, bringing the interest rate to 5%. Additionally, the vote raised the debt ceiling by 20 million to 120 million DAI.
According to data from DeFi analytics site DeFi Pulse, investors have been taking advantage of the lower rates. Since the decision was made to lower the stability fee, there has been a roughly 10% increase in ETH locked in Maker.
Based on current trends, it seems that the influx of ETH on Maker may be at the expense of the second-largest DeFi lending platform, Compound, which saw a drop of roughly 5% over the past week. Compound offers 0.04% daily interest, which is notably higher than the current daily rate on Maker.
At the same time, the amount of DAI locked in DeFi has grown by around 8 million, with the vast majority going to Compound.
Time will tell whether these trends will continue, especially given the fluctuating nature of Maker’s stability fees and growing competition from other lending platforms.
More: DeFi Pulse Data | Maker Data
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Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.