MakerDAO, the governing authority of the Maker Protocol, has seen its revenue plummet in the third quarter of 2022. According to an Oct. 13 tweet by Johnny_TVL, a Messari analyst and co-author of “The State of Maker Q3 2022,” the decentralized autonomous organization saw its revenue drop to just over $4 million in Q3, down 86% from the previous quarter. One of the results of this has been MakerDAO’s first quarter of net income loss since 2020.
The Messari senior research analyst has pointed to the weakening of the crypto market and few liquidations as reasons for the drop in revenue. Two of its biggest earners, Ether and Wrapped Bitcoin, have performed poorly in the last quarter, with revenue from ETH-based assets falling 74% and revenue from BTC-based assets falling 66%.
Borrowers use these cryptocurrencies as collateral for loans of Dai stablecoin , providing some security from the volatility often seen within cryptocurrency markets at the cost of interest paid on the loans.
The analyst also pointed out that MakerDAO’s collateral ratio had fallen from 1.9 to 1.1 at the same time last year. However, he pointed out that expenses were not so elastic, with expenses falling only 16% in the quarter compared to the previous quarter.
These days, MakerDAO's placed its focus on acquiring U.S. Treasuries and bonds. It wants to lock up excess crypto in safe U.S. government securities, which it believes will add a steady stream of returns to the protocol.
MakerDAO has a proven track record of promising, and now they are investing highly in new treasuries and bonds, which will help them to have higher returns on assets that they hold as collateral.
HVB has created a vault with 100 million Dai, a new type of collateral in the Maker Protocol, which will help it generate additional revenue through vault stability fees associated with maintaining the vault and minting DAI.