MakerDAO community voted Supports maintaining the Gemini USD stablecoin as part of the Protocol’s DAI stablecoin reserve amid bankruptcy concerns.
The MakerDAO community has launched a vote ahead of two governance votes to limit DAI’s exposure to Gemini due to the liquidity crisis plaguing Gemini’s Earn program. The GUSD stablecoin can be used as collateral for Mint Maker’s DAI stablecoin.
In a poll that ended Jan. 19, 50.85% of voters favored maintaining the GUSD debt ceiling at $500 million in the Maker’s Peg Stability Module (PSM), while 49.15% favored removing it entirely. We averted the GUSD tragedy because we supported it.
PSM is a mechanism that allows users to create DAI in exchange for collateral accepted by Makers. Additionally, it maintains the DAI peg to the US dollar.The result means that MakerDAO will still hold 85% of all GUSD It is distributed in that PSM.
Concerns about GUSD
There are concerns about MakerDAO’s exposure to Gemini, mainly $900 million of Gemini Earn assets remain locked in Genesis, which has suspended withdrawals. Gemini is also under pressure after it stopped withdrawing from its yield-producing Earn program. Additionally, the U.S. Securities and Exchange Commission has sued the exchange for allegedly selling unregistered securities.
Another concern about the value of GUSD is that it is partially backed by cash held by Silvergate Capital. The hard-hit crypto-friendly bank is one of many that suffered a crypto-related meltdown last year.
However, Tyler Winklevoss, CEO of Genesis, said: relieved The Maker community said the only exposure MakerDAO had to Gemini was through the Peg Stability module. Additionally, the CEO has ensured that the GUSD reserves backing the DAI stablecoin will not be subject to bankruptcy proceedings.
Maker currently holds $489 million in GUSD as collateral against a debt ceiling of $500 million, the maximum amount of DAI that can be minted in the Gemini Dollar.of suggestion From its Strategic Finance Core Unit, MakerDAO says it is currently earning $7.3 million from its exposure to GUSD.