Home / Crypto Currency / Maker Price (MKR) Explodes Through $750 as Dai Cryptocurrency Awaits Augur Integration

Maker Price (MKR) Explodes Through $750 as Dai Cryptocurrency Awaits Augur Integration


Maker MKR price cryptocurrency rally

Advertisement

Maker (MKR), the central token of the Maker smart contract platform and the Dai stablecoin system, has experienced a phenomenal rally over the past month, bolstered a major partnership and an investment from one of the cryptocurrency industry’s top venture funds.

Less than one month ago, on Sept. 12, MKR was trading below $300. Since then, the token has gone on a tear, rising 159 percent to a present value of $758 on Monday morning. The Maker price has risen 24 percent in the past 24 hours alone, raising the MKR market cap to $552 million and launching the token to 22nd in the market cap rankings.

maker price MKR Dai cryptocurrency
MKR/USD | Source: CoinMarketCap

Investors should note that this massive price swing has been accompanied by relatively little trading volume. Over the past 24 hours, for instance, MKR has seen just $3.3 million in trading volume, with approximately 60 percent of those trades concentrated on OasisDEX.

This caveat aside, though, MKR has seen a dramatic rise, and this rally has correlated with two major announcements regarding the cryptocurrency token.

A16z Makes $15 Million MKR Bet

As CCN reported, legendary venture capital firm Andreessen Horowitz (a16z) recently invested $15 million in Maker, acquiring 7 percent of the network’s total currency supply and 6 percent of its total decision-making power. A16z has been investing in the cryptocurrency ecosystem for years, but the firm’s MKR purchase marked its first investment through its newly-launched $300 million cryptocurrency fund, which has received backing from Yale University’s $29.4 billion endowment.

“The investment of A16Z in MKR is conceptually similar to putting dollar savings in a US-based bank. Upon placing a certain amount of money in a bank like Goldman Sachs or JPMorgan, an individual receives a monthly or yearly return based on the program offered by the bank,” CCN explained at the time. “With money obtained from its clients, the bank then loans the capital out to trusted businesses and individual investors with high interest to pay out its clients that provided the bank with an initial capital.”

Specifically, MKR holders receive interest when the Maker network issues loans denominated in Dai, an asset-backed stablecoin whose value is collateralized to the U.S. dollar.

While the size of a16z’s investment itself would not have been enough to push the MKR price up this far, the fact that firm of this size and prestige would place such a bullish bet on the asset likely sent a buy signal to retail investors.

Augur to Add Support for Dai Stablecoin

More recently, on Oct. 4, the developers of decentralized prediction market Augur announced that they would add support for Dai on the platform, which heretofore had only allowed punter’s to place bets using ether.

Though renowned as one of the most-anticipated dApps and most promising applications of censorship-resistant blockchain technology throughout its multi-year development cycle, Augur has yet to build a sustainable user base in the several months since its deployment on the Ethereum mainnet.

According to DappRadar, the platform — which allows users to bet on the outcome of virtually any future event — had 57 users in the past 24 hours, with a cumulative volume of less than 212 ETH (around $48,000) spread across 184 transactions. That’s above average for the dApp, which has generally seen daily active user figures in the mid-30s throughout September and early October.

Holding ETH is already a gamble, as the second-largest cryptocurrency’s value has both traded above $1,400 and below $170 within the past calendar year. Consequently, some would-be users may be hesitant to further roll the dice by placing bets — particularly those with long time horizons — that could cause them to lose money (i.e. fiat purchasing power) even if they win the bets themselves.

Adding a stablecoin should provide users with the assurance that the assets they are staking and stand to win will retain a consistent value throughout the life of the bet, narrowing the risk associated with staking money in a prediction market to the bet itself. As the developers said, “Integration of a stable coin as the denomination for markets will allow money at risk to be exposed to less volatility.”

Given the growing number of stablecoins available, Augur’s decision to choose Dai for its platform is a huge vote of confidence in the Maker network and its ability to maintain a consistent peg to the value of the U.S. dollar.

Featured Image from Shutterstock

Follow us on Telegram or subscribe to our newsletter here.
Join CCN's crypto community for $9.99 per month, click here.
Want exclusive analysis and crypto insights from Hacked.com? Click here.
Open Positions at CCN: Full Time and Part Time Journalists Wanted.
Advertisement
Read more

Check Also

Former Goldman Sachs Exec Launches Crypto Startup Amid Bear Market

Although many are enamored with bashing the colloquial term “BUIDL,” for many Bitcoin diehards, 2018’s crypto market lull has been a time to unironically bolster this industry’s underlying infrastructure. This isn’t just hearsay, as 2018 has arguably been crypto’s strongest year yet, in terms of promising products, platforms, and startups, rather than day-to-day price action. Some of the world’s largest corporations and financial entities, such as the Intercontinental Exchange, Citigroup, Nasdaq, Microsoft, IBM, and Goldman Sachs, have all instituted crypto-centric initiatives. Yet, while these efforts are undeniably valiant, there remain entry barriers for a majority of keen parties, which curtails the growth of this industry. This issue isn’t flying under the radar, however, as startups have continued to crop up, seemingly in a bid to usher household names into this embryonic ecosystem. Meet Peter Thiel-backed Tagomi Peter Thiel, the head honcho of the so-called “Paypal Mafia” — ex-Paypal executives turned hotshots in Silicon Valley and Wall Street — has long been open to the concept of Bitcoin. On multiple occasions, Thiel, an advocate for libertarian principles, claimed that Bitcoin could become a hedge against economic downturns. So, it should as no surprise that his illustrious venture capital group, the San Francisco-based Founders Fund, has made notable capital allocations into crypto startups. As reported by NewsBTC in early-May, one of the fund’s allocations into this industry took the form of a multi-million dollar financing of Tagomi, a little-known firm at the time, with not much more than an ambitious vision. Now, over half a year since Tagomi secured Thiel’s rare stamp of approval, the startup has put its grandiose plan into action. On Monday, Tagomi, potentially slated to become the Fidelity Investments of the cryptosphere, launched its prime broker-dealer services — purportedly the first of its kind. For those who missed the memo, the startup is primarily focused on executing large orders for its bigwig clients. Speaking with Bloomberg, the upstart’s co-founder, Greg Tusar, and other key executives explained how its system operates. Tagomi takes advantage of its access to an array of exchanges to produce a liquidity pool, easing slippage for gargantuan block orders, while ensuring that transparency and proper trade reporting is upheld. Tusar, a former Goldman Sachs magnate, explained that there currently are pertinent issues plaguing crypto-friendly high net-worth investors today, namely custody, security, and a lack of liquidity. He stated: “The current environment is challenging, for sure, but we think there’s a lot of longer-term demand for digital assets and helping clients understand the transformative impact of crypto and blockchain.” In a separate interview with The Block, Tusar alluded to the fact that Tagomi is, or is aiming to, fill that gaping hole in this industry, and quick. He explained that there hasn’t been a single platform that has shepherded clients from depositing fiat, deciding on an investment thesis, allocating capital to cryptocurrencies, securing holdings, and all the way to managing these investments for the long haul. This is, of course, where the Peter Thiel-backed entity aims to come in and lend a helping hand. Institutions Look To Buy The Crypto Dip This launch of this innovative platform only underscores the fact that institutions see value in cryptocurrencies, but have resorted to staying on the sidelines due to the blockades that remain. Still, a number of startups backed by well-known institutions, like Fidelity and TD Ameritrade, have aimed to solve this problem. Related Reading: Why Are Novogratz, Fidelity, And Bakkt Banking On Institutional Crypto Investors? Fidelity, for instance, recently launched a crypto-centric subsidiary — Fidelity Digital Asset Services (FDAS) — after downing the Bitcoin red pill in 2014, when the firm’s launched its in-house blockchain research group. FDAS has its eyes on becoming a spiritual successor of its parent, but specifically in the context of crypto. More specifically, the fledgling arm has ambitions to launch top-notch cryptocurrency custody, coupled with trade execution for Fidelity’s 13,000 institutional clients. Similar moves from Bakkt, which has close ties to the parent of the New York Stock Exchange, and ErisX, a similar offering funded in part by TD Ameritrade, have again, only accentuated abounding institutional interest for digital assets. But the question that remains on everyone’s mind is — who will be the one to capture that demand? Featured Image from The post Former Goldman Sachs Exec Launches Crypto Startup Amid Bear Market appeared first on NewsBTC.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Disclaimer: Trading in bitcoins or other digital currencies carries a high level of risk and can result in the total loss of the invested capital. theonlinetech.org does not provide investment advice, but only reflects its own opinion. Please ensure that if you trade or invest in bitcoins or other digital currencies (for example, investing in cloud mining services) you fully understand the risks involved! Please also note that some external links are affiliate links.