MakerDAO raises debt ceiling to $1 billion for Dai allocations in Ethena’s stablecoin markets on Morpho

MakerDAO has approved a board vote to raise the debt ceiling of its direct deposit module to $1 billion for its Dai stablecoin, with a focus on investing in Ethena ENA

+11.76%
‘s USDe and its counterpart, sUSDe, through Morpho Labs credit vaults.

This adjustment is part of a broader strategy to diversify MakerDAO’s collateral exposure, which marks a major financial commitment to Ethena’s stablecoin and also allows the protocol to generate additional revenue for users.

An initial $600 million from MakerDAO’s Dai holdings will be allocated to these credit markets, underscoring the protocol’s commitment to Ethena’s USDe. This step is made possible using MakerDAO’s Spark protocol, which prefers allocations to USDe pools over those to sUSDe.

USDe, unlike traditional stablecoins, uses a support mechanism that combines ETH and derivatives in a cash-and-carry trading framework. This involves staking Ethereum collected from USDe coiners and simultaneously shorting ether futures, introducing a unique approach to stablecoin backing. Its emergence has sparked discussions within the crypto sector about the associated risks, particularly regarding USDe’s return generation methods.

In response to MakerDAO’s last allocation, there was one proposed call from an Aave employee for a reassessment of Dai’s risk parameters in Aave’s credit markets, suggesting possible adjustments to loan-to-value ratios for Dai-based loans. Notably, Aave is a competitor to both MakerDAO and Morpho.