Why MakerDAO Has Sold $31.20 Million in MKR in Two Months

6 months ago 7

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MakerDAO has recently executed substantial sales of its governance token, MKR. According to the on-chain analytical platform Spot On Chain, MakerDAO’s Multisign 0xbba deposited a significant 750 MKR, valued at $2.19 million, to Binance. This transaction happened through a middle wallet – 0x1cc at a price of $2,920.

This action is part of a broader trend that has garnered attention within the industry.

Price Impact on MKR

Spot On Chain observed that since its resurgence on March 18, 2024, the multisign has consistently deposited MKR tokens. The deposits total a staggering 11,993 MKR, valued at $31.18 million at an average price of $3,184. These deposits often precede a price drop, indicating a strategic approach to managing market movements.

During this period, a notable transfer involved 9,043 MKR, amounting to $29.75 million, which flowed from Wintermute Trading OTC to various centralized exchanges (CEXs) like Binance, Coinbase, and Kraken between March 18 and April 22. Additionally, 2,950 MKR, valued at $8.43 million, was directly deposited into Binance via the intermediary wallet 0x1cc in the last 11 days.

Despite these transactions, the multisign still retains a substantial 18,978 MKR, worth over $60 million.

This flurry of activity coincides with MakerDAO’s plans to introduce two new tokens – NewStable (NST) and NewGovToken (NGT). NST, an upgraded version of Dai, promises enhanced stability features for broader adoption. On the other hand, NGT represents a revamped governance model aimed at fostering wider participation and dynamic decision-making within MakerDAO’s ecosystem.

Dai holders can seamlessly upgrade to NST, while MKR holders can convert each MKR into 24,000 NGT, promoting broader engagement in governance activities.

“These additions represent an expansion and will not replace the existing Dai (DAI) and Maker (MKR) tokens. Users will have the option to transition to NewStable and NewGovToken,” MakerDAO wrote.

Despite recent market fluctuations that saw MKR dip by approximately 28% from its April highs, there are indications of a potential reversal.

Technical analysis points to the formation of a bullish cup and handle pattern, with a breakout from the neckline potentially pushing prices up by nearly 14% to $3327. However, failure to breach this level could see support forming around $2,700.