MakerDAO Reduces DAI Stablecoin DSR Interest Rate to 7%

The proposal to lower the Dai Savings Rate (DSR) for the DAI stablecoin has been officially approved by MakerDAO on the evening of July 15.

MakerDAO Reduces DAI Stablecoin DSR Interest Rate to 7%

In the recently approved proposal by Maker Gov, the maintenance fee (borrowing interest rate) for ETH and BTC Vaults has been adjusted down to the range of 7-9.25%

Notably, the Dai Savings Rate (DSR) interest rate has been lowered to 7%. To ensure stability between the lending and deposit markets, the borrowing interest rate for the DAI stablecoin will also be adjusted down to 8%.

Along with the reduction in the borrowing interest rate for the DAI stablecoin, MakerDAO has also raised the borrowing cap for weETH (the Liquid Restaking Token format of the Etherfi project). Specifically, in the Isolation Mode market for weETH, the borrowing cap will be set at 200 million DAI. Additionally, the collateral deposit limit for this asset will be increased to 200,000 weETH.

The proposal also includes the transfer of 220,000 DAI to Aave Governance as part of a profit-sharing agreement between Spark Protocol (a lending branch of MakerDAO) and Aave. This topic sparked significant controversy last week when Aave alleged that MakerDAO had employed financial maneuvers to minimize the amount of money owed back to Aave.

MakerDAO's move to reduce the DSR interest rate comes at a time when the project is planning to invest $1 billion worth of reserve assets into the Real World Asset (RWA) sector. Additionally, the protocol has just approved a plan to shift the storage of USDC with a third-party custodian to the LitePSM model to increase decentralization and reduce legal risks.