An early investor in Maker (MKR) protocol moved their holdings for the first time in seven years. The whale wallet swapped the funds back to Ethereum (ETH).

A super early investor in Maker (MKR) divested their holdings, which they acquired at the inception of the project. The early buyer acquired MKR at $23, realizing profits at the current price of $1,628.90. MKR has returned to the levels of January 2024 after a month-long slide. The project traded just under $4,000 during the market peak in March.

The sale of 251.5 MKR earned 172.5ETH or around $401K. The wallet used Cow Protocol and liquidated the MKR in a series of decentralized transactions. MKR is getting divested after its rebranding to Sky, especially after adding a lock function to the DAI stablecoin.

The high-net wallet has a remaining balance of 200 MKR, with the bulk of holdings in ETH. The owner also held several older protocols that failed to take off, including OMG and REP, migrating the tokens over the years to new chains.

Maker prepares for changes in collateral structure

MKR will also not serve as collateral after its final Endgame upgrades, potentially cutting into demand for the token. MKR may remain valuable as a governance token, deciding how to redistribute the protocol’s stablecoins.

Maker’s total value locked has also been down by 50% since the March peak as traffic moved to other lending protocols. In the meantime, Maker is changing its collateral structure, which may include tokenized T-bills. In its documentation on the Endgame, Maker called for maximum sovereignty of its assets, especially some forms of tokenized RWA.

The weight of T-bills in Maker’s portfolio already started expanding in 2023, making more than 26.5% of the protocol’s earnings.

Rebranded Maker partners with Aave

Maker, soon to use its new Sky brand, has dropped to the sixth position among the largest DeFi protocols. The value locked in DAI is around $5.79B, dropping from a peak above $10B.

Aave (AAVE) is now the biggest lending protocol, locking more than $10.9B in value. The rebranded DAI in the form of USDS and sUSDS is supposed to flow into Aave. USDS will be used in Aave V3, the most liquid vault.

The proposal to include USDS into Aave V3 and the Lido version of Aave V3 is still in the temp check phase. USDS will be both a borrowing and lending asset on Aave, with fees and characteristics similar to those of other stablecoins.

If the communities vote in favor of the proposal, the integration of Sky and Aave may happen as soon as September 18. A market for Spark native tokens has also been proposed, as a way for AAVE holders to vote in the lending protocol.

The rebranded Maker also aims to build a role for SPK tokens, which are still in the farming stage. The SPK tokens may be used as an incentive in an upcoming airdrop, to gain more engagement from Aave users. The Spark.fi protocol still carries $2.36B in value locked, mostly from ETH collaterals and locked DAI.

The partnership between Maker and Aave, titled the Sky Aave Force Initiative, is still in the proposal stage, with temperature checks on the respective communities. The proposal arrived about a year after Maker deemed Aave as a risky protocol.

Aave has been growing its native GHO token, while also receiving a proposal to include USDS in its lending process and collateral vaults. The coming months will show if DeFi can have a more viable model, while reshuffling the balance sheets of major protocols.

After the rebranding, Maker also plans to open the way for more sub-DAOs similar to Spark.fi, with the potential to build their own collateral structure.

The renewed inflows of USDS follow a period where DAI lost its influence on other DeFi protocols, mostly due to the 2022 bear market. Additionally, the USDC loss of the $1 peg in March 2023 raised the risk of DeFi.

As the industry returns in 2024, Maker is trying to rebuild its influence and connect with formerly competitive protocols. The partnership with Aave will also involve Spark.fi, one of the decentralized protocols that most actively used DAI. Spark is a Maker subnet, aiming to extend the ecosystem and offer passive income for staking DAI.

Cryptopolitan reporting by Hristina Vasileva