Phoenix Labs introduced Spark Lend as a facet of their MakerDAO proposal.
According to the proposal, Spark will launch a $200 million DAI lending vault on Maker in April.
Phoenix Labs to give Aave DAO 10% of Spark Protocol DAI market revenues for two years.
According to a proposal posted on Maker's governance forum on Wednesday, influential members of the MakerDAO community have proposed the creation of a new liquidity market dubbed Spark Protocol for lending and leasing crypto assets focused on DAI, Maker's $5 billion stablecoin.
https://twitter.com/cryptonewsland/status/1623524583910391809?s=20&t=kgWZxjD78SFnwSGoOsBdnw
The debut offering, Spark Lend, will allow users to borrow DAI at the DAI Savings Rate of 1%. According to the proposal, Spark Lend will accept as collateral BTC, ETH, DAI, wrapped derivatives of staked ETH (wstETH), and other highly liquid decentralized assets (wBTC). In addition, the Maker's unique synthetic liquid staking derivative (LSD), EtherDAI, will be applied with fixed-term yield products.
According to the proposal, Spark plans to debut in April this year by establishing a DAI lending vault on Maker with a maximum debt of $200 million.
According to the report, Spark would use the DeFi lending giant's most recent update, Aave v3, which has an ingenious contract mechanism. Phoenix Labs, the protocol's development team, has committed to providing Aave DAO 10 percent of all protocol earnings from the Spark Protocol's DAI market for the next two years.
MakerDAO is a major DeFi platform that also issues the $5 billion DAI stablecoin, which is backed by $7 billion in treasury assets. Aave is a prominent lending protocol, according to reports, with a total value of $7.2 billion protected on the platform. A highly autonomous organization (DAO) manages both protocols through voting, with individuals possessing governance tokens able to support or reject ideas.
According to an email statement, the proposal is a watershed moment for Maker since Spark would be the first native Maker-based lending interface with which any crypto user may engage, including by linking their crypto wallets and borrowing directly from Maker.
Reportedly, the suggestion expands on Maker founder Rune Christensen's ambitious-yet-contentious "Terminator scheme," which effectively seeks to divide MakerDAO's administration structure into smaller chunks known as SubDAOs.
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