After going through the bear market in 2022, the decentralized stablecoin protocol MakerDAO still delivered outstanding results, with a net income of 18.8 million for the whole year of 2022. Although it is much lower than the 90.2 million in 2021, it is compared with other loss-making cryptos. Organization, MakerDAO’s image of gifted students continues to be maintained.

In a challenging macro environment, the overall balance of DAI decreased by 43%, from 9 billion at the end of 2021 to 5 billion at the end of 2022, which forced MakerDAO's transformation and turned to real-world assets RWA's increasing share of assets, Including the groundbreaking trade involving the U.S. Treasury ETF, RWA treasury balances reached 640 million DAI by the end of the year, compared with only 17 million DAI at the end of 2021.

Unit: million

MakerDAO’s asset allocation is mainly focused on about 70% of stablecoins. Among them, DAI/USDC LP has almost no return, and only GUSD (increased to 500 million DAI at the end of the year) has a return of 1.25% (now 1.5%). Most of the income comes from Public Credit government credit (MIP65 proposal Monetalis Clydesdale, 80% of the funds are invested in US Treasury bonds, and 20% is used in investment grade corporate bonds). Although the amount is only 500 million (only 10%), it Bringing in nearly half of the income.

(Extended reading: Crypto profits are not as good as expected, DeFi moves closer to real-world assets)

possible risks

Although it has experienced the crypto oscillations in 2022, MakerDAO has always maintained the anchoring effect of its stablecoin DAI, and has also successfully maintained the organization's profits through investment in real-world assets. But MakerDAO also pointed out several risks that need to be paid close attention to:

  • Liquidation of crypto collateral can be settled reasonably easily on-chain. However, the liquidation of off-chain collateral has not been tested, which represents uncertainty about the protocol’s ability to implement off-chain measures to maintain the value of the collateral.

  • Unilateral government enforcement leading to the seizure of off-chain collateral could adversely impact the integrity of the protocol and MakerDAO’s ability to maintain DAI’s tracking of USD.

  • Significant changes in interest rates may negatively impact Maker's collateral value.

This article: Who still makes money in a bear market? MakerDAO turns to real-world assets first appeared on Chain News ABMedia.