Supply of DAI stablecoins surged to a 5-month high of 5.35 billion, according to Makerburn.com data.
The steep rise comes as users, including well-known DeFi firms like Justin Sun and OlympusDAO, rush to cash in on the higher returns from maker deposits.
Maker is a stablecoin issuance platform on Ethereum and is governed by the MakerDAO community made up of MKR token holders.
In addition to increasing supply, the protocol’s annual revenue also hit a two-year high of 165.4 million, according to Makerburn.com data, as DAI supply increased. That means Maker currently makes about $165 million per year in fees.
Annualized Fee Earnings. Source: Makerburn.com
Maker records increasing sales
Deposits in the protocol’s DAI Savings Rate (DSR) have nearly increased from $340 million to $1.3 billion since last week, according to a Dune dashboard by Sebastien Derivaux, MakerDAO’s head of asset-liability quadrupled.
The surge is likely due to the MakerDAO community voting on Aug. 6 to temporarily increase annual returns from 3.19% to 8%.
Manufacturer’s DSR contracts allow DAI holders to earn on the protocol’s earnings by depositing DAI into it. Revenue comes from income from security deposits and fees paid by Maker users.
Both Tron founder Justin Sun and OlympusDAO-affiliated wallets deposited $148.5 million and $124.8 million worth of DAI, respectively, to take advantage of the higher yields.
The top depositors in the DSR contract. Source: Makerburn.com
Additionally, a rise in short-dated US Treasury yields to a five-month high of 4.91% also helped boost the minutes’ earnings.
The rise in yields played a key role in boosting the protocol’s earnings due to its significant exposure to US Treasuries. Bonds account for 57.7% of MakerDao’s total revenue, according to Derivaux’s Dune dashboard.
Derivaux told Decrypt that “revenues should remain elevated as long as short-term interest rates remain elevated.” He added that MakerDAO’s earnings should increase as Paxos and Gemini start paying MakerDAO earnings on their stablecoin deposits , similar to USDC returns via Coinbase Custody.
“This has been a year-long effort to make these assets profitable and I am pleased that it is bearing fruit,” said Derivaux.
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