submitted a suggestion that can be seen MakerDAO (MKR) earns up to $24 million annually if passed.

Under the proposal, MakerDAO would transfer $1.6 billion worth of Peg Stability Module (PSM) 33% — approximately $528 million — into a custodial account. Prime to earn 1.5% annual return on savings.

PSM is a mechanism designed to help keep Maker's DAI at $1, starting with the 2020 crypto market crash when spiked above 1 USD.

Since then, PSM has effectively helped DAI maintain the exchange rate.

Recently, key members of raised concerns that PSM is underinvested (underinvested - occurs in businesses with low free cash flow but many good growth investment opportunities).

One of the members argued that the underinvestment of PSM reduces:

“The protocol’s risk-taking capacity and its appeal as a .”

So, Coinbase's proposal is designed to provide a safe investment path for Maker's PSM. As suggested, the protocol there will be no custodial fees for PSM allocation.

In addition, Maker Governance will be able to mint, burn, withdraw and process payments in less than 6 minutes.

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The proposal also explains how the rewards will be paid and the payment schedule.

DAO members support the idea

Most of the comments on this proposal are positive, given that this way of investing can limit risk.

However, some members said APY level of 1.5% is a bit low. Instead, it should “be a flexible rate to match the market, with the potential to increase when starting to see higher APRs again after crypto winter.”

Meanwhile, some members claimed the proposal could affect Maker decentralization and add another layer of regulatory attack to the protocol.

MakerDAO core team members, such as the Growth Core Unit, Collateral Engineering Services Unit, and Strategic Finance Core Unit, have also expressed their support for the proposal.

At the time of writing, MakerDAO's native token MKR is growing over 3% and trading at $745 as the largest cryptocurrency in the market. showing signs of improvement.

The source: TradingView

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