MakerDAO’s money market, Spark Protocol, hits its DAI debt limit less than two weeks after raising its cap from $20 million to $200 million.
Maker found that it took users just eight days to borrow $180 million from DAI. According to Blockanalitica, the pool’s occupancy rate is currently 99%.
spark markets
Spark’s milestone comes at a time when competition between decentralized stablecoins is intensifying, with Maker hoping to protect DAI’s market share from new DeFi-native stablecoins issued by Curve and Aave.
The spike in activity on Spark followed MakerDAO increasing its DAI Savings Rate (DSR) — accessible to Spark users — from 3.3% to 8% to drive Spark and DAI adoption. However, DSR yields decrease as utilization increases.
The move was an instant hit, as Spark’s total value locked (TVL) rose 674% from $58 million to $449 million in six days. According to Dune Analytics, the DSR’s TVL has also increased by more than 300% and currently stands at $1.39 billion.
Spark protocol TVL
The Spark protocol was launched in June after members of the MakerDAO team forked Aave v3, the leading DeFi lending protocol.
crvUSD is making a comeback
crvUSD, a competing stablecoin of leading stablecoin DEX Curve Finance, is also gaining traction.
On August 16, crvUSD supply reached an all-time high, with users borrowing more than $107 million of crvUSD against collateral deposited on Curve. This followed a brief dip in crvUSD usage, with public confidence in the Curve protocol being shaken two weeks ago after an exploit against Vyper – the smart contract programming language used by Curve – led hackers to pay US$25 million -Withdrawn dollars from Curve’s liquidity pools. Most of the stolen assets were later returned.
DeFi lender Alchemix says Vyper hackers have returned stolen cryptocurrencies
Affected protocols had posted a bounty if the attacker returned the funds.
crvUSD supply plummeted from $100 million in late July to a local low of $65 million just a week later after the incident. Curve first deployed crvUSD in May and expanded its collateral and debt ceiling in June.
GHO picks up speed
With the launch of GHO a month ago, Aave also wants to stake its claim on the decentralized stablecoin sector.
Despite launching less than five weeks ago, Aave users have already minted 22.4 million GHO tokens, surpassing the early growth of crvUSD and Spark.
However, GHO has struggled to maintain its peg to the US dollar as the token’s price has consistently trended downward since its launch. According to Token Logic, the average price of GHO over the last 24 hours was $0.967.
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