Coinbase Looking To Acquire $1.6B of MakerDAO’s USDC

The centralized exchange hopes to dissuade Maker from exiting its USDC holdings amid fallout from the US’ Tornado Cash sanctions

article-image

Blockworks exclusive art by axel Rangel

share

key takeaways

  • Coinbase earns interest from USDC, which makes up 35% of Maker’s collateral
  • Maker would earn up to $24 million in revenue from the investment

The very-centralized crypto exchange Coinbase has proposed an investment line with MakerDAO, the organization behind the largest decentralized stablecoin. 

It appears adversity truly does make strange bedfellows.

The proposal would move a third of the Circle stablecoin backing Maker’s dai stablecoin, an estimated $1.6 billion, to Coinbase Prime in exchange for 1.5% yield — or an estimated $24 million of MakerDAO revenue. The proposal comes as Coinbase stock has plummeted and Maker reckons with the regulatory risk created by its USDC holdings.

Maker making the most of its USDC

MakerDAO is the largest single USDC holder. 

The stablecoin makes up 35% of dai’s collateral, roughly $4.8 billion. The dollar-backed stablecoin allows Maker to invest in non-crypto assets, as with its recent $100 million credit line inked with Huntingdon Valley Bank. 

Maker’s leadership has been calling for the DAO to shift away from USDC since the token’s developer team blacklisted Ethereum addresses in response to US Tornado Cash sanctions. But the Maker community was sour on Circle — even before the Treasury got involved.

“In the last couple of years, Maker has been actively contemplating how to get the USDC off its balance sheet,” Greg Di Prisco, Maker’s former head of business development, told Blockworks. “Maker holds USDC and makes nothing.”

The Coinbase proposal is being pitched as a way to get a return on the DAO’s dead weight USDC holdings. And while Coinbase does not follow Maker’s decentralized principles, the DAO’s leadership sees the centralized exchange as a pragmatic business partner.

“In an ideal world I would say we are completely crypto collateral backed because we get maximum decentralization. This is impossible in my view though,” Sam MacPherson, an engineer at Maker, told Blockworks. “There’s just not enough demand for loans against ETH [and other cryptocurrencies].”

Even Rune Christensen, MakerDAO’s co-founder who has led the charge calling for Dai to move its backing to Ethereum, voiced support for the initiative, writing under Coinbase’s forum post, “from a regulatory/legal/seizure risk perspective, this proposal changes nothing – it’s no different than holding USDC.”

Coinbase keeps a customer

The proposal would keep Maker as a customer for Coinbase, which co-founded USDC in 2018. The company earns interest from Circle on its USDC holdings, which totaled $360 million in June, per Coinbase’s SEC filings.

Coinbase is making its pitch weeks after Christensen threatened to “yolo” Maker’s USDC holdings into ether following the Tornado Cash sanctions.

“Coinbase is now saying, ‘Hey, so, you don’t leave USDC, we’ll give you 1.6% to stay,’” Di Prisco said.

Coinbase has endured a rough year amid the crypto market downturn. The company’s revenue and active users shrunk between the first and second quarters, and Coinbase’s stock price has fallen nearly 75% since the start of 2022. 

The exchange is also the subject of multiple lawsuits regarding its listing of digital assets the SEC has recently deemed securities.

Coinbase will hope for a stroke of positive news when its proposal is put to a vote on Maker’s governance portal.

Coinbase declined to comment.


Get the news in your inbox. Explore Blockworks newsletters:

Tags

Decoding crypto and the markets. Daily, with Byron Gilliam.

Upcoming Events

Old Billingsgate

Mon - Wed, October 13 - 15, 2025

Blockworks’ Digital Asset Summit (DAS) will feature conversations between the builders, allocators, and legislators who will shape the trajectory of the digital asset ecosystem in the US and abroad.

recent research

Research Report Templates.png

Research

Content Delivery Networks (CDNs) represent low-hanging fruit in a massive market ripe for Web3-driven disruption. The global CDN market was valued at ~$28B in 2024, and is projected to surpass $140B by 2034, (18.75% CAGR) underscoring the immense demand for efficient content delivery.

article-image

In crypto investing, quantity has a quality all its own.

article-image

REX and Osprey prep to launch their Solana staking ETF

article-image

A 40% allocation to crypto today is safer than a 1% allocation was in 2021, Ric Edelman argues

article-image

The wallet doesn’t have enough memory for more apps and features but should still function, the company says

article-image

The proof-of-work L1 is betting on parallel-chain scaling, low fees, and a $50 million grant program to lure Solidity developers and tokenized RWA issuers

article-image

Sponsored

Injective is not waiting for the future of finance. It is bringing it directly to us, today.