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Maker DAO becomes a decentralized central bank



 Is this the long-awaited marriage of traditional finance and crypto? The traditional French bank Société Générale, or rather its subsidiary SG Forge, has submitted an application to Maker DAO to be allowed to deposit its own OFH token as collateral for a loan of 30 million DAI. With 83.16 percent of the votes, a majority of those entitled to vote spoke in favor of the motion . This means that nothing stands in the way of the first DeFi loan for a traditional major bank.



The fact that the decentralized organization accepts the bank token OFH as collateral for the loan, which is oversecured at 40 million euros, is historic. There has never been a comparable process before. The OFH token is a $100 million Société corporate bond that the group launched on the Ethereum blockchain in 2019. The structure of these securities with a Moodys rating of AAA is rock solid. At 0 percent, however, they offer no return.


Is the maker central bank going to school?

The transaction is therefore an attempt by representatives of the traditional financial sector and the crypto sector who are keen to experiment. Two things are new and worth mentioning about the transaction: On the one hand, Maker is open to accepting collateral such as the OFH token - rather unusual in crypto circles. Depositing bitcoin or ether derivatives such as wrapped bitcoin is common.


On the other hand, and this is the crucial point, Maker advances here to a quasi-central bank. After all, the USD 30 million in DAI stablecoin did not exist before the transaction. Similar to the ECB, Maker creates money out of thin air .


In the end, granting the loan is a zero-sum accounting game with enormous complexity. But if the deal works out, and it looks like it does, then Société Générale has landed a new investor with the decentralized organization, with whom liquidity bottlenecks can be circumvented in the future.


At 83.16 percent, the popularity in the maker community is outstanding. The voter ARCEinvest writes :


There comes a time when the "real world" needs us more than we need them. I am delighted that this innovative collaboration has come about. The timing couldn't be better to show the world that there is serious work in DeFi, with credible players still interested in the solutions that only MakerDAO can provide.


It is not the first step into the crypto sector for Société Générale. In February , we reported on tokenized securities issued by the bank in Luxembourg.

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