After Coinbase Institutional presented the proposal on 6 September, it was approved with 75% of the votes on 24 October. One-third of the treasury underpinning the Peg Stability Module, which enables users to deposit security in exchange for DAI, Maker’s stablecoin pegged to the U.S. dollar, is represented by the USDC. This update was included in a recent tweet by MakerDAO.
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After the adoption of MIP 81, MakerDAO enrolled in Coinbase’s institutional rewards pilot program, allowing it to earn 1.5% on USDC held in custody by Coinbase.
The DAO Peg Stability Module (PSM), which is in charge of handling the governance fees the MakerDAO generates from swaps, will be available on Coinbase around the clock, every day of the year.
Following the approval of the MIP 81 proposal, the MIP 82 proposal was also approved. The approval of this proposal would enable the MakerDAO community to issue a USDC loan to Coinbase in the amount of $500 million.
Possible retracement and rally in view
In the 12-hour time frame, MKR did not seem impressed with the latest development, as no spikes could be seen in movement. However, the trend line on the chart showed that the asset had been on an upward trend.
On 22 September it hit a low of about $563, but it had since recovered, increasing by more than 60%. MKR was up more than 1% as of this writing, fetching a price of about $930.
There was a lot of volatility in the asset, as seen in the 12-hour timeframe chart, with the price swinging up and down several times.
But $797.8 and $657.9 were where the support line showed up. This level of support was tested, and it appeared to be holding. Below the price action, the short and long Moving Averages, represented by the yellow and blue lines, were visible, both acting as support.
The areas surrounding $1,082.7 and $1,224.6 acted as resistance.
Fibonacci Retracement analysis applied to the 12-hour time frame showed additional downside potential for MKR. An eventual retracement to the 0.618 level is possible, which would mean a drop to roughly $800. Once it reaches the support level, it could then begin to rally again, with a potential target of $1,600.
As of this writing, USDC had a market cap of approximately $43 billion, making it the sixth largest cryptocurrency by Coinmarketcap’s metrics. DAI ranked thirteenth, with a market cap of about $6 billion.