coinedition.com
Adam Cochran, the crypto entrepreneur behind Synthetix, has questioned and expressed concerns about MakerDAO’s recently unveiled Savings DAI token (sDAI). sDAI was introduced by the DeFi lending platform earlier this week. It is an ERC-4626 token powered by the Dai Savings Rate (DSR) and is the tokenized version of DSR-enabled DAI.
I missed this… are they just getting the yield from the bond lending program stuff they were doing with banks etc, and then passing that yield on..?
— Adam Cochran (adamscochran.eth) (@adamscochran) June 21, 2023
Cause a centralized management party providing pass through money market yield would make a very happy Gensler… https://t.co/X5bsEZWYs6
Cochran, who also happens to contribute to Yearn Finance, took to Twitter earlier today to highlight MakerDAO’s latest DeFi offering. He stated that he had missed sDAI’s announcement and questioned if the yield passed on to Maker’s customers was derived from the bond lending program that the DeFi protocol was recently involved with in collaboration with traditional banks.
According to Adam Cochran, if that were the case, then it would attract the attention of the U.S. Securities and Exchange Commission (SEC). The crypto entrepreneur pointed out that if the yield was coming from a centralized management part that provided yield from the money market, it would make SEC Chair Gary Gensler “very happy”.
The crypto community on Twitter responded to Cochran’s tweet by pointing out that DAI’s borrow rates had increased by 3% and that the yield was passed on from that. The MakerDAO community voted in favor of a proposal last week that increased the Dai Savings Rate from 1% to 3.49%.
The new rate came into effect on June 19, 2023, and within 24 hours MakerDAO introduced the sDAI token powered by the renewed DSR. sDAI implements a tokenized EIP-4626 compliant wrapper for DAI deposited into the DSR, converting the DSR-deposited position into a token users can hold and use.
According to MakerDAO, the new sDAI token allows users to interact with the DSR by depositing DAI into the DSR by calling Savings DAI’s mint method or withdrawing DAI from the DSR by calling Savings DAI’s burn method.