MakerDao Launches Spark Protocol, a New DeFi Lending Protocol

MakerDao, a decentralized autonomous organization that runs on the Ethereum blockchain and issues the stablecoin DAI, recently launched a notify Regarding the release of its latest DeFi product Spark Protocol.

The news was shared via the official MakerDao Twitter account, which stated that the Spark protocol will be available to all DeFi users starting May 9, 2023.

According to the tweet, Spark Protocol, a DAI and end-user-centric DeFi product, will be deployed on Ethereum. The product will feature issuance and lending of ETH, stETH, DAI, and sDAI. The first version of the Spark Protocol, Spark Lend, will be a lending marketplace designed specifically for offering and borrowing cryptocurrencies, with an emphasis on DAI.

Spark protocol users will be able to interact directly with Spark’s user interface, which will connect Maker’s liquidity to a complete DeFi solution. MakerDAO stated that the Spark protocol is one of the many enhancements Endgame Era will bring to the MakerDAO ecosystem, enabling a breakthrough solution that can only result from a connection between DeFi products and the Maker protocol.

The Spark protocol is connected to Maker’s D3M, which will provide wholesale credit lines directly in DAI, injecting and automatically balancing new DAI liquidity into Spark Lend. This will enable users to obtain the best DAI loan rates on the market. Regardless of the size of the borrower, the interest rate does not increase with use.

The Spark protocol will also introduce an encrypted version of DAI to be deposited into the DSR, called Savings Dai (sDAI). Through Spark Lend, users will be able to use a profitable version of DAI that is automatically connected to the Dai Savings Rate module. The Dai Savings Rate is currently 1% per annum and may be changed via Maker Governance on-chain voting, which will directly affect Spark Lend’s Dai rate.

In addition, the Peg Stability Module (PSM – Peg Stability Module) connects the huge liquidity infrastructure to Instant Swap DAI and sDAI for USDC at a ratio of 1:1, and vice versa. Users can now import DSRs from USDC, further increasing product flexibility.

MakerDao’s announcement also highlights the importance of providing DeFi users with leading-edge, decentralized, scalable, and truly Ethereum-based technology. This latest offering reflects the company’s focus on vertically integrating existing products into Maker and sharing the value created with developers, with Phoenix Labs Development Co. playing a key role in Spark Protocol product innovation.

In Maker Endgame’s new organizational structure, companies are given the role of “Ecosystem Participants”. With the launch of the Spark protocol, MakerDao has once again demonstrated its commitment to innovate and provide cutting-edge solutions to the DeFi community.

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