MakerDAO increases U.S. Treasury holdings by $700M to support DAI stablecoin with tangible assets.

The MakerDAO, a stablecoin issuer and decentralized finance protocol, has purchased an additional $700 million worth of U.S. Treasuries, bringing the total of its DAI stablecoin reserve to $1.2 billion, according to a press release from the platform.

This purchase is part of Maker’s strategy, called the “Endgame Plan” by founder Rune Christensen, to diversify the assets supporting the $4.5 billion dollar-pegged stablecoin by increasing the role of traditional financial assets, such as government bonds, in the reserve.

The acquisition is part of a proposal that was approved in March to increase the limit of a vault that invests in short-term government bonds to $1.25 billion. This particular vault is managed by asset manager Monetalis and is one of the facilities that ensures DAI remains pegged at $1.

The platform is currently undergoing a restructuring process that involves breaking up its structure into smaller, autonomous units called SubDAOs, and investing in yield-generating, real-world assets to increase protocol revenue during a time when the demand for crypto lending is low.

Allan Pedersen, the CEO of Monetalis, stated that “Through the diversification of its collateral pool with this U.S. Treasury ladder strategy, Maker is taking advantage of the current yield environment and putting its assets to work.”

Recently, the community approved the onboarding of a new vault that invests in real-world assets and is managed by crypto asset manager BlockTower. This is the first step towards an additional UST purchase of up to $1.28 billion in the future. Voting members also agreed to remove $500 million of Paxos Dollar (USDP) and $390 million of Gemini Dollar (GUSD) from the reserve to pursue higher yielding investments.

Edited by Sheldon Reback.

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