- MakerDAO price has been in a strong bullish trend in the past few days.
- The DeFi protocol rejected a $100 million loan to Cogent Bank.
- It has jumped above the 200-day exponential moving average.
MakerDAO crypto price made a strong bullish breakout on Wednesday after the DeFi protocol rejected a major loan proposal. MKR jumped to a high of $944.85, the highest level since October 27. It has jumped by 90% from the lowest point this year.
MakerDAO rejects loan
MakerDAO is one of the leading players in the blockchain industry. It is a lending protocol that makes it possible for people and companies to borrow funds in the form of Dai, its stablecoin. Dai is an algorithmic stablecoin that always trades at $1 and has a market cap of more than $5 billion.
MakerDAO is the second-biggest players in the industry. According to DeFi Llama, the total value locked (TVL) has risen to about $7.2 billion. At its lowest point in 2022, the network had a TVL of more than $6.89 billion. The only protocol that is bigger than MakerDAO is Lido. MKR is the native token for the MakerDAO ecosystem.
Maker’s MKR price rose after the members of the DAO rejected a loan of $100 million to Cogent Bank, a small regional company with over $1 billion in assets. The bank planned to use the funds to increase its balance sheet and lend more money to individuals.
Maker has offered similar loans before. In 2022, the company extended loans worth millions of dollars to Huntingdon Valley Bank. In a statement, analysts at the London Business School warned about the bank’s liquidity and the fact that it will be significantly difficult to liquidate the loans.
Another important MakerDAO news is the ongoing debate about allowing users to borrow DAI with the MKR token. Analysts caution that such a product will be eerily similar to what led to the collapse of Terra and its ecosystem in 2022.
MakerDAO crypto price forecast
The daily chart shows that the MKR price has been in a strong bullish trend in the past few days. As it rose, it retest the October 22 high. Most importantly, it has moved above the 200-day exponential moving average (EMA). It has also risen above the 50-day EMA. Therefore, there is a likelihood that the coin will form a golden cross, which happens when the two averages make a crossover.
The MACD has continued rising. Therefore, there is a likelihood that the coin will continue rising as buyers target the key resistance level at $1,000, which is about 10% above the current level. A successful move above this level will see it rise to about $1,178, the highest point on March 10.
