MakerDAO, a blockchain protocol, is strategically positioning itself as a leader in the real-world assets (RWA) space, gaining significant attention within the cryptocurrency industry as of late.
“MakerDAO has strategically diversified its revenue by incorporating U.S. Treasury securities into its portfolio,” the recent report states.
RWAs are an important part of the Maker DAO revenue stream
A recent report indicates that Maker DAO’s choice to invest in US Treasuries in June 2023 appears to be yielding positive results. It positions Maker at the forefront of the real world assets (RWA) industry.
RWAs represent the on-chain counterparts of the physical world or traditional financial assets, encompassing a broad spectrum from real estate and bonds to invoices.
“It is this strategy that has fueled positive price movement for MKR, driving annual returns among the leading RWA protocols. It is also no surprise that MKR is first in terms of average transaction volume, reaching an average daily volume of $94.5 million during the second week of January.”
Maker says its tilt toward RWAs has strengthened the risk profile of its collateral businesses.
“This move not only improved the stability of its revenue streams, generating over $100 million in annualized revenue, but also improved the risk profile of its side businesses,” the report notes.
According to a July 2023 report, MakerDAO earned 80% of its commission revenue from RWA.
However, on its website, Maker breaks down its collateral RWAs into four sections: cash, clean money, miscellaneous, and physical resilience. These four sections highlight the assumption that there will be a significant crackdown on the use of RWAs in cryptocurrencies in the future.
“Physically resilient RWAs are real assets that cannot be easily seized. A DAO like Maker can maintain a certain level of technical sovereignty over those assets,” she says.
To know more: RWA tokenization: a look at security and trust
RWA Tokenized Treasury Securities
Meanwhile, RWAs shined even in the bear market last year.
Additionally, BeInCrypto reported in September 2023 that tokenized Treasuries have seen 450% growth since the start of 2023. This significantly contributes to the $1.66 billion added last year.
A recent report from Chainlink suggests enabling blockchain for assets currently outside the digital asset ecosystem. This will improve financial systems, offering greater liquidity, greater transparency and reduced systemic risks.
To know more: What is the impact of tokenizing real-world assets (RWA)?
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