Low Turnout Hinders MakerDAO Vote to Decrease Stablecoin Stability Fee by 2%

The vote to decrease stability fee for MakerDAO’s Ethereum blockchain-based decentralized stablecoin Dai has failed, according to the voting results published on May 20.

The vote about whether to decrease the fee by 2% to 17.5% per year started yesterday, May 19. MakerDAO is looking to change the yearly stability fee in an attempt to improve the token’s peg to the U.S. dollar after its exchange price has been hovering above $1. The stability fee is a charge levied by Maker participants when DAI is used for loans.

Voters failed to stake the minimum 117,631.90 MKR tokens necessary to vote and as such, the proposal is unfulfilled at press time.  

Per the voting results, over half of vote threshold represents a total of two major token owners with a share of 54,000 MKR tokens. The number overcame other options of the poll, which registered more individual voters, but less in the number of staked tokens overall.

In March, Maker increased the stability fee twice — first to 3.5% and then to 7.5% per year. MakerDao stated then that “incentivizing CDP [collateralized debt position] closures through a Stability Fee increase (thereby reducing outstanding Dai) is strongly viewed as the appropriate action.”

In April, the fee was further raised by another four percent in the fifth such vote this year, bringing it to 11.5%. Subsequent votes brought the rate up to 19.5% at the beginning of May.

Also this month, MakerDAO announced a critical security update to its governance contract. While the announcement claimed that the tokens of users who had staked MKR tokens in the contract were not in danger, it also advised users to move them. Still, no action is required from users who are not in control of one of the nearly 190 addresses who have staked MKR in the current voting contract.

At press time, dai is worth $1.00 according to data from CoinMarketCap.