Source: AdobeStock / Roman Tiraspolsky
The price of MKR, the governance token of the MakerDAO Lending and Borrowing Protocol, rose on the market today after French investment banking giant Societe Generale published a proposal to lend stablecoins with a tokenized bond as collateral.
The price rebounded even before almost the entire market moved up sharply, with Bitcoin (BTC) and Ethereum (ETH) rising by 8.7% And 2.5%, Respectively, over the same period.
The proposal, submitted to MakerDAO’s governance forum by the bank’s blockchain-focused subsidiary Societe Generale – Forge (SG-FORGE), set out details about the bond tOkens – with the bank stating that they were issued on the Ethereum blockchain in May 2020 and that they can only be traded over-the-counter (OTC).
The bank, often nicknamed “SocGen”, continued to write in its proposal that the bond, secured by housing loans, has a fixed interest rate of 0% and matures in 2025. It also has a top AAA rating from major financial rating agencies Fitch and Moody’s, the bank wrote.
The proposal went into great detail on how the loan could be spent, including an illustration showing the proposed relationship between Maker, SocGen, SG-forge and a proposed exchange agent.
MakerDAO FOUNDER Rune Christensen shared the news on Twitter, writing that he was “amazed that he had no idea” that such a request would come, and that it showed the power of the governance model for organizations post-founding.
“Many thanks to those who helped to make it this far. They all know who they are, so I’m not going to do it for them unless they want the public awards,” wrote PaperImperium, the DAO’s most powerful delegate with about 3% of all votes on the record, adding:
“Maker and SocGen-forge are on the precipice of financial history. What a time to be alive.”
“A milestone, even more so for traditional credit institutions than MakerDAO,” said user luca_pro, saying the proposal brings back into focus how to share and decentralize responsibilities in an ecosystem of borrowers, structurers, intermediaries and financiers. “Kudos to those who contributed,” luca_pro said.
