MakerDAO: Is whale interest the catalyst MKR needs?
- Whales begin to accumulate MKR.
- MakerDAO’s Spark protocol saw massive growth and attracted new addresses to DAI.
According to recent data posted by Lookonchain, whales have started to accumulate MakerDAO [MKR] in large amounts over the last few weeks.
Notably, a significant withdrawal of 2,251 MKR ($3.18 million) was executed by a whale from the Binance [BNB] platform.
0x04e9 withdrew 47,096 $AAVE($4.7M) and 2,251 MKR($3.18M) from #Binance 10 hours ago.https://t.co/TbOkgxxLXH
3 fresh wallets (funded by the same address, possibly belonging to the same person) withdrew 2.57M… pic.twitter.com/274oy9atSq
— Lookonchain (@lookonchain) December 25, 2023
Whale interest on the rise
This behavior by whales could have both positive and negative implications for MKR.
On the positive side, the reduction in circulating supply could potentially create upward price pressure, benefiting MKR holders. The market’s perception of this large withdrawal may also enhance confidence in MKR as an appealing asset.
However, the negative impacts are noteworthy. The sizable transaction might induce short-term price volatility, and liquidity concerns could arise if the withdrawal represents a significant portion of available liquidity on the exchange.
Additionally, market speculation surrounding the intentions behind the withdrawal may lead to unpredictable price movements and heightened market dynamics.
Seeing a Spark
A significant factor favoring MakerDAO is the success of the Spark protocol, facilitating the seamless flow of hundreds of millions of DAI.
At press time, 528 million DAI has been deposited into Spark, bolstering fresh and direct liquidity.
With the current debt ceiling standing at 800 million DAI, this influx contributes to Maker Protocol’s anticipated yearly income of approximately 27.1 million DAI from Spark’s credit line.
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This positions Spark as Maker’s highest-earning crypto-native vault. Notably, this marks a milestone as the first fully operational product sustained by a SubDAO within the MakerDAO ecosystem.
These factors could add further bullish sentiment around the MKR token, which was trading at $1,425.64 at press time. Its price had fallen by 0.37% in the last 24 hours, though its volume remained high.