MakerDAO: DAI Supply Hits 18-Month Low, Brace for Impact? DAI Supply Takes a DiveThe
total supply of MakerDAO's decentralized stablecoin
DAI has hit its lowest point since August 2023, as reported by MakerBurn data.
CDP Model at PlayThis decline in DAI supply is a result of the protocol's
Collateralized Debt Position (CDP) model, which acts as a self-regulating market.
Borrowing Becomes PricierWhen the value of assets backing DAI drops, the interest rates for borrowing on the platform soar. This deters new borrowers and prompts existing ones to repay loans swiftly.
A Bearish MACD, but Bulls PersistWhile MakerDAO's native token MKR has seen some bearish signs with its Moving Average Convergence Divergence (MACD), it's important to note that demand remains steady.
Accumulation vs. Weak Bear PressureThe Relative Strength Index (RSI) suggests that bulls are still accumulating MKR tokens, but caution is advised as the Awesome Oscillator (AO) shows weak accumulation pressure against a longer-term bearish sentiment.
In this delicate balance between bears and bulls, the market awaits the next move for MakerDAO and its resilient stablecoin DAI.
