According to CoinDesk, Maker (MKR), the governance token of decentralized finance (DeFi) lender MakerDAO, experienced a more than 10% increase on Thursday, despite slumping cryptocurrency prices. The platform has become profitable again after adjusting its lending rates. Maker is currently the best performing digital asset with a market capitalization above $100 million, significantly outperforming the broader crypto market proxy CoinDesk Market Index’s 3.5% decline.
There was no specific development that triggered the rally, but MakerDAO's fundamentals have improved recently. The platform has returned to profitability after a brief increase in spending on incentives, according to Kunal Goel, senior research analyst at Messari. MakerDAO is one of the largest crypto lending protocols and issuer of the $5 billion stablecoin DAI. The platform has increased revenues by investing its vast stablecoin reserves in real-world assets such as U.S. government bonds and lending to banks to capture higher yields in traditional finance as part of a major overhaul called 'Endgame.'
Earlier this month, MakerDAO temporarily increased rewards for DAI holders to as much as 8%, but the payouts erased the platform's profit expectations. The platform has since lowered rewards and increased borrowing rates, making it profitable again, Goel said. MKR holders are benefiting from the platform's profits through Maker's token buyback scheme, introduced last month, which reduces the outstanding supply on the market using surplus revenues from the platform's treasury.
The Maker-adjacent lending platform Spark has also seen growth, nearing an all-time high of $700 million in total value locked (TVL) on the protocol, according to DefiLlama data. Maker founder Rune Christensen unveiled a proposal earlier this month to roll out Spark's SPK tokens via airdrop.
