MakerDAO allows for $1.28B US Treasury purchase.

The MakerDAO community, which is a decentralized autonomous organization (DAO) responsible for the stablecoin DAI, has authorized the purchase of up to $1.28 billion in U.S. government bonds through the crypto asset manager BlockTower Capital.

The decision to open a new real-world asset (RWA) vault named BlockTower Andromeda was unanimously approved by voters in a vote concluded on Thursday. The vault is dedicated to investing a maximum of $1.28 billion in short-term U.S. Treasury bonds, which will be funded by Maker’s overcollateralized DAI stablecoin, according to the proposal.

BlockTower will receive a 0.15% arranger fee from Maker. Celadon Financial Group will act as a broker, and Wedbush Securities will handle the custody of assets.

Maker has previously invested $1.1 billion in government and corporate bonds through a vault managed by asset manager Monetalis Clysdale. It has also provided loans to banks such as Huntingdon Valley Bank and Societe Generale-Forge, the crypto-focused subsidiary of the French banking giant.

This latest decision is part of Maker’s efforts to diversify the reserve assets that support its $5 billion stablecoin DAI and increase protocol revenues by investing in yield-generating strategies. Maker earns a yield by storing $500 million USDC at blockchain Prime, while Gemini pays Maker rewards for holding Gemini Dollar (GUSD) among the reserve assets.

The investment plan also highlights the growing demand for traditional financial instruments among crypto-native entities such as DAOs as a means of earning a stable yield on their treasury.

BlockTower already manages several Maker vaults, which currently invest around $90 million in structured credit products on the blockchain-based credit protocol Centrifuge.

Edited by Nelson Wang.

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