{"id":18607,"date":"2023-03-11T18:33:50","date_gmt":"2023-03-11T18:33:50","guid":{"rendered":"https:\/\/crowdfundjunction.com\/blog\/makerdao-issues-emergency-proposal-to-address-3-1b-in-usdc-collateral-after-stablecoin-depegging-incident-bitcoin-news\/"},"modified":"2023-03-11T18:33:50","modified_gmt":"2023-03-11T18:33:50","slug":"makerdao-issues-emergency-proposal-to-address-3-1b-in-usdc-collateral-after-stablecoin-depegging-incident-bitcoin-news","status":"publish","type":"post","link":"https:\/\/crowdfundjunction.com\/blog\/makerdao-issues-emergency-proposal-to-address-3-1b-in-usdc-collateral-after-stablecoin-depegging-incident-bitcoin-news\/","title":{"rendered":"Makerdao Issues Emergency Proposal to Address $3.1B in USDC Collateral After Stablecoin Depegging Incident \u2013 Bitcoin News"},"content":{"rendered":"

(Originally posted on : Bitcoin News )<\/b>
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On March 11, 2023, the decentralized finance project Makerdao issued an emergency proposal following the USDC depegging incident that saw the stablecoin dip down to $0.877 per unit. At the time of writing, Makerdao commands $3.1 billion in USDC collateral that backs a portion of the project\u2019s stablecoin, DAI.<\/strong><\/p>\n

Makerdao Proposes Changes to Limit Exposure to Potentially Impaired Stablecoins<\/h2>\n

Members of Makerdao have been discussing a recent emergency proposal<\/a> that aims to address the $3.1 billion in USDC assets the project holds as collateral. The news comes as Circle Financial revealed<\/a> it had funds stuck at the financial institution Silicon Valley Bank (SVB) and the firm\u2019s stablecoin, USDC, broke its $1 parity. Presently, USDC is changing hands for $0.91 per coin, but five other stablecoin assets have been affected.<\/p>\n

Makerdao\u2019s DAI stablecoin is down to $0.92 per coin<\/a>, and the stablecoin slipped to a 24-hour low at $0.881 per DAI. DAI\u2019s unstable activity has caused the Makerdao team to issue an emergency proposal to address the $3.1 billion in USDC it holds.<\/p>\n

\u201cThe proposed changes are intended to limit Maker\u2019s exposure to potentially impaired stablecoins and other risky collateral while maintaining enough liquidity to prevent DAI from trading significantly above $1 if conditions change and ensuring there is adequate market liquidity to process potential liquidations of crypto-collateralized vaults,\u201d the proposal states.<\/p>\n

Further, the Makerdao proposal explains the collaterals \u201care exposed to potential USDC tail risk.\u201d Additionally, Makerdao says the \u201cproposal(s) implementing the above changes are expected to be posted in the next ~12 hours or less.\u201d Makerdao is encouraging all voters to review and support the proposals \u201cas soon as possible.\u201d<\/p>\n

This isn\u2019t the first time Makerdao has had issues<\/a> with DAI\u2019s collateral backing as precisely three years ago, during the March 12 \u201cBlack Thursday\u201d event, the depleting price of ethereum (ETH<\/a>) strained the stablecoin project. Estimates<\/a> indicate that roughly $4 million worth of the stablecoin DAI was left underwater due to an auction failure.<\/p>\n

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\nTags in this story
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Auction<\/a>, Black Thursday<\/a>, cash and stables<\/a>, Circle Financial<\/a>, collateral<\/a>, collaterized<\/a>, Crypto<\/a>, DAI<\/a>, DAI price<\/a>, Dai Stablecoin<\/a>, decentralized finance<\/a>, DeFi<\/a>, emergency proposal<\/a>, Ethereum<\/a>, Exposure<\/a>, failure<\/a>, Impact<\/a>, impaired<\/a>, Liquidity<\/a>, makerdao<\/a>, market<\/a>, Parity<\/a>, potential<\/a>, proposal<\/a>, Risky<\/a>, Silicon Valley Bank<\/a>, Stability<\/a>, Stablecoin<\/a>, stablecoin assets<\/a>, Stablecoins<\/a>, stables<\/a>, support<\/a>, tail risk<\/a>, underwater<\/a>, USDC<\/a>, Voters<\/a><\/div>\n<\/div>\n

What do you think the impact of Makerdao\u2019s proposed changes will be on the decentralized finance space and the stability of stablecoins? Share your thoughts in the comments below.<\/strong><\/em><\/p>\n

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\nJamie Redman <\/h6>\n

\nJamie Redman is the News Lead at Bitcoin.com News and a financial tech journalist living in Florida. Redman has been an active member of the cryptocurrency community since 2011. He has a passion for Bitcoin, open-source code, and decentralized applications. Since September 2015, Redman has written more than 6,000 articles for Bitcoin.com News about the disruptive protocols emerging today.

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Image Credits<\/b>: Shutterstock, Pixabay, Wiki Commons<\/em><\/p>\n

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