Crypto is no longer a feud for the TradfI as MakerDAO wishes to collaborate with the traditional financial space. The latest proposal by the MakerDAO community highlights bridging the gap between TradFi and crypto.
What Has Happened to MakerDAO?
The community wishes to co-exist with the traditional financial institutions for sustainability. In this pursuit, they have proposed setting up a $100 million treasury for Huntingdon Valley Bank (HVB). The proposal found 83% strong backing from the community.
With such an initiative, MakerDAO will not only exist in the DeFi space as a front runner lending and borrowing protocol. Rather, they can now even process real time loans in USD. Their plans will be fully backed by the government.
With such collaboration, MakerDAO for the first time can also directly engage with audiences in a traditional manner as well. To perform this task, Maker DAO will set-up a Multi-Bank Participation Trust. Banks can directly participate in the MakersDAO operation through this trust. Loan disbursal will happen through the use of these funds. Banks will have a said percentage of ownership along with MakerDAO in these funds.
Initially, the HVB has a 50:50 ratio percentage. However, over time, they have plans to reduce the same to 5% for MakersDAO to gain full control of the operations. MakerDAO has also plans to aid banks through this collaboration since mot of their risks would be covered by the DAO protocol.
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