MakerDAO’s MKR Rallies 30% Post “Executive Vote,” Whale Secures $5.21M Profit

MakerDAO has implemented significant changes to its protocol to bolster the stability and demand for its Dai (DAI) stablecoin amidst fluctuating market conditions. This decision comes on the heels of a significant price surge for its native token, MKR, which has seen an over 30% increase over two days. The bullish momentum was still in play at press time, with the MKR price trading at $2,675.73, up 7.49% from the intra-day low.

MKR/USD 24-hour price chart (source: CoinStats)

Amidst this volatility, a prominent investor, known by the address 0x8af, capitalized on the situation by selling 939.8 MKR for approximately 2.54 million DAI, equating to an average price of around $2,702 per MKR.

This sale was part of a more significant strategic play following a withdrawal of 4,077 MKR from the Bybit exchange in October 2023 at a much lower price of approximately $1,439 per MKR. This investor retains 3,077 MKR, valued at an estimated $8.33 million, marking an estimated total profit of $5.21 million, or an 89% increase.

After the $MKR surged 30% (2D), whale 0x8af sold 939.8 $MKR for 2.54M $DAI at ~$2,702 in the past 4hrs for profits!

He/she withdrew 4,077 $MKR from #Bybit in Oct-23 at only ~$1,439,

And now still holds 3,077 $MKR ($8.33M) with an est. total profit of $5.21M (+89%)!

Follow… pic.twitter.com/V7znhBHIhA

— Spot On Chain (@spotonchain) March 11, 2024

Market Reactions and Strategic Decisions

The strategic adjustments introduced by MakerDAO are a direct response to the rapidly changing dynamics within the cryptocurrency market. Specifically, these changes address a significant reduction in Dai’s supply, which dropped from $5 billion to $4.4 billion over the last seven days. The decline prompted MakerDAO to propose an “Executive Vote” to introduce temporary fee adjustments and measures to strengthen the protocol.

The proposal, backed by BA Labs, a member of the Maker Stability Advisory Council, suggests an expedited approval process for stablecoin stability measures, especially if users opt to redeem a portion of the $1.1 billion in real-world assets (RWA) available on the protocol.

Due to the recent market volatility conditions, an Accelerated Proposal has been put forth for an Executive Vote to prepare the Maker Protocol for a potential excessive Dai demand shock caused by further bullish sentiment.

The Maker Protocol is working as expected, maintaining…

— Maker (@MakerDAO) March 8, 2024

The proposed adjustments include increasing stability fees on various collateral assets from 15% to 17.25%, elevating the SparkLend DAI Borrow annual percentage yield from 6.7% to 16%, and other modifications to enhance the protocol’s stability and responsiveness to market conditions.

MKR/USD Technical Analysis

On the MKRUSD 24-hour price chart, the stochastic RSI is in the overbought range with a rating of 90, indicating that Maker (MKR) may soon be due for a price correction. If the price correction occurs, it may provide a buying opportunity to buyers wishing to enter or increase their position in Maker (MKR) at a lower price point.

MKR/USD 24-hour price chart (source: TradingView)

However, the Moving Average Convergence Divergence (MACD) trend in the positive region suggests that Maker (MKR) remains optimistic, which could lead to further price increases before a correction. For a probable reversal, the MACD must pass below the signal line, indicating a shift in momentum toward a negative trend. However, the histogram still shows positive values, implying that there may be some consolidation before a price reversal.

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