MakerDAO (MKR) has joined the list of altcoins taking charge of the market momentum with its 13.70% growth to $879.74 over the past 24 hours, per data from CoinMarketCap. While there are many tokens whose growth is being fueled by unknown reasons, MakerDAO's upsurge is different.
The protocol revealed that it has set its debt ceiling for funding crypto lender platform Aave to 5 million DAI units. DAI generated the token billed for the Decentralized Finance (DeFi) lender as it seeks to serve as a dominant liquidity provider for this renowned platform.
This will enhance the utility base of the MakerDAO protocol and the DAI token, while also creating a revenue generation stream for the entire ecosystem. Setting the Debt Ceiling from which liquidity can be drawn is also a show of influence the protocol seeks as the DeFi ecosystem is undergoing a unique shift.
The liquidity provisions will also be extended to Aave's top rival Compound, and while this designated fund may appear small, it shows the capacity of MakerDAO to showcase its interoperability capabilities.
MakerDAO and market balance
With the growing demand in the DeFi world and for high-yield products, the protocol's latest moves have been centered on achieving market balance across the board. As reported by U.Today, MakerDAO launched the Spark protocol back in February as a major competitor to Aave.
The Spark Protocol promises to establish a highly liquid cryptocurrency lending market, offering users the option of fixed or variable rates. MakerDAO is smart in its bet-hedging across the board, and its plans to fund lending protocols is an ingenious move to broaden its reach in a market with growing competition.
MakerDAO's influence has been a well-noted one over the years, and the opinions of its core developers have helped shape the broader outlook of the industry to date.