Societe Generale Withdraws $7M in DAI From MakerDAO Vault

In August, MakerDAO added the bank’s digital asset-focused subsidiary, Societe Generale–Forge, to its vaults with a credit limit of $30 million in DAI after a unanimous vote

article-image

Hadrian/Shutterstock.com modified by Blockworks

share

French banking giant Societe Generale has used its MakerDAO vault for the first time to withdraw $7 million worth of MakerDAO’s stablecoin DAI

In August 2022, MakerDAO added the bank’s digital asset-focused subsidiary, Societe Generale–Forge (SG-Forge), to its vaults with a credit limit of $30 million in DAI following a unanimous vote. The vault is backed by 40 million euros in bonds in the form of ‘OFH tokens’ — tokenized securities issued on Ethereum and backed primarily by home loans with Moody’s Aaa rankings — making the loans overcollateralized. 

It’s the culmination of a process started in October 2021 when SG-Forge laid the groundwork to convert borrowed DAI into US dollars to be loaned to parent bank Societe Generale in exchange for the OFH tokens — essentially a refinancing operation — in a historic use of DeFi infrastructure on public Ethereum. 

What sets this apart from other MakerDAO vaults?

Unlike DAI’s other backing assets, the OFH tokens have no liquid market, so the liquidation procedure — in the event the loan becomes undercollateralized — is more manual than generally applies to MakerDAO’s other collateral vaults. 

MakerDAO delegate and crypto researcher Mika Honkasalo told Blockworks the process for SG-Forge to make its first withdrawal has been slow, but he expects the bank to withdraw its maximum $30 million in DAI “soon.”

“I’m not actually sure why it took them so long to use the vault, except that my experience with these real-world asset things is that everything always takes a long time,” Honkasalo added. 

Societe Generale, a global banking behemoth with 138,000 employees across 62 countries, is the first to take on this initiative with Maker. The plans align with MakerDAO’s aims to increase the collateral base of its DAI stablecoin and diversify away from a reliance on volatile crypto assets — namely ether — and the centralized stablecoin USDC.


Start your day with top crypto insights from David Canellis and Katherine Ross. Subscribe to the Empire newsletter.

The Lightspeed newsletter is all things Solana, in your inbox, every day. Subscribe to daily Solana news from Jack Kubinec and Jeff Albus.

Tags

Upcoming Events

Salt Lake City, UT

WED - FRI, OCTOBER 9 - 11, 2024

Pack your bags, anon — we’re heading west! Join us in the beautiful Salt Lake City for the third installment of Permissionless. Come for the alpha, stay for the fresh air. Permissionless III promises unforgettable panels, killer networking opportunities, and mountains […]

recent research

Screenshot 2024-05-23 091855.png

Research

Bitcoin L2s aim to boost scalability while preserving decentralization and security, unlocking a better user experience, and new avenues for Bitcoin-powered innovations. However, no existing Bitcoin L2 leverages the full security of Bitcoin.

article-image

Sponsored

The convergence of AI and blockchain on Polkadot represents a groundbreaking opportunity for investors and developers alike

article-image

The company is making public a previously private offer rejected by Bitfarms’ board of directors last month

article-image

Semler Scientific, a publicly traded medical tech company, joined MicroStrategy by buying up millions of bitcoin

article-image

As someone who’s been knee-deep in the trenches of blockchain development, I can’t help but wonder if these behemoths are really cutting it anymore

article-image

UNI and MKR are suffering from the successes of their respective protocols

article-image

Maybe there’s no silver bullet to avoiding most tokens dumping after launch…