MakerDAO Launches Two New Tokens: Here’s What to Know

MakerDAO Launches Two New Tokens: Here’s What to Know

MakerDAO Introduces NewStable and NewGovToken

MakerDAO, the trailblazing Ethereum-based protocol renowned for its DAI stablecoin, has caused a monumental shift in its ecosystem with the imminent introduction of two novel tokens: NewStable (NST) and NewGovToken (NGT). These tokens are aimed at enhancing stability and governance within the MakerDAO community with greater features and incentives for users.

MakerDAO’s initiative signals a move towards fostering wider adoption and community engagement. NewStable (or NST for short) is envisioned as an upgraded iteration of the existing DAI stablecoin, boasting advanced stability features. 

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The official terminology for NewStable will be disclosed during the forthcoming brand reveal. Simultaneously, MakerDAO is rolling out NewGovToken (NGT) as a governance token designed to incentivize increased participation from the community. The formal designation for NGT will also be unveiled during the launch season, adding to the event’s anticipation.

Seamless Transition for DAI and MKR Holders 

Meanwhile, existing DAI holders can seamlessly transition to NST. Also, they have the added flexibility of reverting to DAI if desired. Likewise, Maker tokens (MKR) holders can exchange their holdings for NGT at a conversion rate of 24,000 NGT per MKR.

It’s worth noting that the introduction of NewStable and NewGovToken is not intended to supplant the existing DAI and MKR tokens. Rather, it is to augment the offerings within the MakerDAO ecosystem, providing users with a broader spectrum of choices tailored to their preferences.

Among the key features of NewStable is that it allows new and existing users to participate in farming activities aimed at earning NGT tokens. An annual distribution of six hundred million NGT is earmarked for NST holders who engage in farming. 

However, it’s essential to highlight that this farming opportunity will be off-limits to US residents and individuals employing VPN services. In tandem with the introduction of NewGovToken, MakerDAO has orchestrated a strategic redenomination scheme, valuing NGT at 24,000 tokens per MKR. 

This move is aimed at encouraging broader community involvement in governance affairs. Importantly, the upgrade process to NGT from MKR is reversible, allowing participants to adjust their positions as needed.

Pension Funds Embrace Crypto Investments

Meanwhile, Fidelity Digital Assets Vice President Manuel Nordeste has disclosed that pension funds actively engage their investment committees about crypto assets. Speaking at an event in London recently, Nordeste highlighted a shifting landscape where traditional institutional investors are increasingly exploring opportunities in digital assets.

According to Nordeste, small-scale investors such as family offices and high-net-worth individuals display greater interest in crypto investments. Fidelity’s survey revealed that 80% of high-net-worth individuals express a positive view of digital assets, compared to only 23% of pension plans.

Despite this gap, 48% of high-net-worth individuals reported investing in digital assets. In comparison, only 7% of pension plans have done the same. Nordeste emphasized that Fidelity Digital Assets, historically focused on smaller specialized asset managers and hedge funds, is now broadening its scope to engage with institutional investors.

This evolution signifies a maturing crypto market and growing interest from traditional financial players. The survey results also shed light on the differing risk appetites between smaller firms and pension funds. Smaller firms, with more flexibility in investment mandates, are quicker to embrace crypto assets. In contrast, pension funds have slower adoption rates since they require longer adjustment periods and stringent market entry requirements.

Institutional Evolution in the Crypto Market

Furthermore, BlackRock, a major competitor to Fidelity, anticipates institutional participation in the spot Bitcoin (BTC) market, including pension funds. In February, Arizona lawmakers resolved that state pension plans should consider including BTC and other digital asset ETFs in their investment portfolios. Despite a 2022 survey showing that 94% of public pension plans had some crypto exposure, American retirees were largely unaffected by the bear market in 2023.

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Rudy Harris
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Rudy Harris

Rudy Harris, a dynamo in crypto journalism, intricately unpacks the multifaceted world of digital assets. Renowned for his analytical depth and clear exposition, Rudy's articles serve as an essential compass for those navigating the intricate corridors of blockchain and cryptocurrency, solidifying his stature as a trusted expert.

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