MakerDAO transfers $250 million from Coinbase to maintain DAI peg

After DAI’s USDC reserves (which need to be at least over $200 million to be considered safe) nearly fell below $60 million on Tuesday morning local time, MakerDAO moved $250 million from Coinbase to DAI’s Pegged Stability Module (PSM) for use Maintain anchorage. It is reported that PSM is a collateral pool that allows users to mint USDC in exchange for DAI at a 1:1 ratio and arbitrage DAI back to the US dollar. If PSM’s reserves are depleted, the price of DAI could go above or below $1. Before the Coinbase Custody transfer arrived, more than $100 million left PSM from Sunday to Tuesday. A person familiar with the matter said that PSM’s large transfers seemed to go to centralized exchanges. On the Maker Forum, Allan Pedersen, CEO of DeFi lending company Monetalis, wrote that the team is working on automating PSM using smart contracts, “but, for now, using trustees, administrators, legal structures and banks/centralized exchanges Command-based automation is safe and stable.” (Blockworks)