MakerDAO revenue tumbles 86% on Ether and Wrapped BTC woes

Messari research shows MakerDAO has experienced its first quarter of net income loss since 2020 following a huge fall in loan demand and few liquidations.

MakerDAO, the governing body of the Maker Protocol has seen its revenue plummet in the third quarter of 2022, caused by a fall in loan demand and few liquidations, while expenses have remained high. 

Meanwhile, MakerDAO has recently taken steps to increase the return on assets it holds as collateral, having commenced a proposal to invest $500 million in treasuries and bonds. MakerDAO believes this will provide the protocol with low-risk additional yield.

One other positive for MakerDAO was the growth in Real World Asset (RWA) backed loans, which now accounts for 12% of its total revenue after it successfully rolled out its largest RWA backed loan to Huntingdon Valley Bank (HVB) in the third quarter of 2022.

The loan, which involved the creation of a vault with 100 million Dai, constitutes a new collateral type in the Maker Protocol which can help it generate additional revenue through vault stability fees associated with maintaining the vault and minting DAI.

HVB is still able to benefit from this integration as it allows the bank to effectively increase its legal lending limit, and MakerDAO hopes that if all goes smoothly other banks will follow behind HVB.