1. **DAI Yield Increase and Growth**: #MakerDAO has raised the deposit rate (DSR) of its #stablecoin DAI from 3.19% to 8% using the EDSR mechanism. This move aims to boost DAI growth and demand by making DSR more appealing. #DAI now offers the highest yield among stablecoins, attracting a substantial inflow of funds, increasing the total DAI amount from around $340 million to $1.18 billion.

2. **Impact on Maker's Finances**: The change in DSR has spurred more DAI #minting through Maker Vaults, reversing a previous supply decline. However, this expansion has financial implications. The 8% DSR leads to a projected annual operating cost of $54 million for MakerDAO. Despite reduced profits (from $84 million to $23 million annually), the decrease is considered a strategic move to rekindle DAI demand, akin to a customer acquisition cost.

3. **Sustainability and Mechanism Details**: The new DSR #mechanism appears sustainable. The EDSR varies with DSR utilization, ranging from 8% for 0-20% utilization, down to 4.15% for 35-50% utilization. While Maker will earn more interest from newly minted DAI, increased DSR deposits could pressure profits, making it crucial to reach the 4.15% EDSR level. This sustainable approach aims to position DAI as an attractive on-chain yield alternative, fostering Maker's growth and setting the stage for Maker SubDAOs to enhance DAI and MKR token utility.

$MKR $ETH $BTC

⚡️ Grove has announced the closure of its $7.9M investment round

Grove, a decentralized physical infrastructure provider, raised $7.9M in the funding round, The investment was secured by Avon Ventures, Placeholder Capital, Druid Ventures and Mechanism Capital. Grove provides Web3 infrastructure for building products and services atop its POKT network, which supports over 40 different chains. Grove will use the funding to form new partnerships to accelerate mainstream adoption.

#Web3🤝🥊🌐 #fundraising #Funds #Funding #mechanism