MakerDAO's $600 Million Gamble on Ethena's Synthetic Dollar: Controversy and Concerns

MakerDAO's $600 Million Gamble on Ethena's Synthetic Dollar: Controversy and Concerns
MakerDAO's $600 Million Gamble on Ethena's Synthetic Dollar: Controversy and Concerns

MakerDAO Considers $600 Million Allocation to Ethena's Stablecoin USDe

MakerDAO, the decentralized finance protocol, is exploring the allocation of up to $600 million in its stablecoin DAI to markets for Ethena's synthetic dollar, USDe. This proposal aims to provide additional liquidity for users seeking exposure to Ethena's assets.

Previous Deployment and Additional Proposal

Last week, Maker deployed 100 million DAI to Spark's lending markets on Ethereum. The current proposal suggests an additional 500 million DAI allocation, with a potential total allocation of 1 billion DAI. This would be deployed to Morpho's lending infrastructure in the staked USDe and USDe/DAI markets.

Controversy and Concerns

The proposal has sparked controversy within the crypto community, with some members criticizing it as overly risky. Marc Zeller, an Aave DAO delegate, labeled it as "the definition of reckless."

Ethena's Vision and Support

Ethena seeks to provide a crypto-native solution for money through its synthetic dollar, USDe. The protocol also offers a savings instrument called the "Internet Bond." Ethena has received support from notable investors, including Arthur Hayes, Franklin Templeton, and Binance Labs.

Recent Funding and Binance Support

Ethena recently raised $14 million in a seed extension round. Binance Launchpool has announced plans to roll out trading support for ENA, Ethena's native asset.


MakerDAO's proposal to allocate DAI to Ethena's USDe markets is currently under consideration. The move would provide additional liquidity for users interested in Ethena's assets. However, it has also raised concerns regarding potential risks. The outcome of the proposal remains to be determined.

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