{"id":30193,"date":"2022-06-17T06:28:39","date_gmt":"2022-06-17T10:28:39","guid":{"rendered":"https:\/\/coinscreed.com\/staging\/?p=30193"},"modified":"2022-06-17T06:28:47","modified_gmt":"2022-06-17T10:28:47","slug":"makerdao-adopts-an-alternative-as-ethereum-steth-falls","status":"publish","type":"post","link":"https:\/\/coinscreed.com\/staging\/makerdao-adopts-an-alternative-as-ethereum-steth-falls\/","title":{"rendered":"MakerDAO Adopts An Alternative As Ethereum (stETH) Falls"},"content":{"rendered":"\n
MakerDAO moves to cut stETH exposure by approving Rocket Pool ETH (rETH)\u00a0as the new alternative.<\/h5>\n\n\n\n
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Following the de-peg of stETH, MakerDAO approved a proposal on Friday to adopt an alternative to Lido-Staked Ethereum (stETH) as collateral.<\/p>\n\n\n\n

The platform authorized Rocket Pool ETH (rETH) as a new vault type, or collateral, in a governance proposal\r\n \r\n \r\n \r\n <\/g>\r\n \r\n \r\n \r\n <\/clipPath>\r\n <\/defs><\/svg><\/span><\/a> that received 64 percent acceptance from the MakerDAO community.<\/p>\n\n\n\n

rETH functions similarly to stETH in that it trades at a 1:1 ratio with ETH<\/a> and may be redeemed for staked ETH after the merge is completed. The token is issued via the staking protocol RocketPool<\/use><\/svg><\/span><\/a>, which was designed by ETH founder Vitalik Buterin.<\/p>\n\n\n\n

rETH is currently selling at $1,093, just a few dollars below ETH pricing. In comparison, stETH is now trading at 0.94 ETH.<\/p>\n\n\n\n

The adoption of rETH is the latest action taken by the major DeFi protocol to mitigate the consequences of the impending insolvency of crypto lenders Celsius and Three Arrows Capital.<\/p>\n\n\n\n

Both entities hold large amounts of stETH as collateral and have been seen dumping stETH to cover their positions. In the event of a liquidation, a huge amount of stETH, ETH, and Bitcoin would be dumped on the open market.<\/p>\n\n\n\n

MakerDAO also prohibited direct transactions with peer Aave earlier this week, citing concerns about the latter's heavy exposure to stETH. Aave is very exposed to a Celsius or Three Arrows<\/use><\/svg><\/span><\/a> liquidation as a result of his exposure.<\/p>\n\n\n\n

Is Lido Staked Ethereum A Problem For Markets?<\/h2>\n\n\n\n


While stETH has no direct impact on ETH prices, its usage as collateral on DeFi<\/a> platforms may eventually result in the liquidation of ETH positions, which may have an impact on prices.<\/p>\n\n\n\n

Following the de-peg of stETH last week, a torrent of liquidations has negatively damaged ETH prices. The depeg was triggered by Alameda Research, one of the token's largest holders, selling its investment.<\/p>\n\n\n\n

The focus is now on the pricing of ETH and Bitcoin<\/a>. If the two go below critical levels, the market might witness another round of liquidations, bringing values to mid-2020 lows.<\/p>\n","protected":false},"excerpt":{"rendered":"

MakerDAO moves to cut stETH exposure by approving Rocket Pool ETH (rETH)\u00a0as the new alternative. Following the de-peg of stETH, MakerDAO approved a proposal on Friday to adopt an alternative to Lido-Staked Ethereum (stETH) as collateral. The platform authorized Rocket Pool ETH (rETH) as a new vault type, or collateral, in a governance proposal that […]<\/p>\n","protected":false},"author":33,"featured_media":30195,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_jetpack_memberships_contains_paid_content":false,"footnotes":""},"categories":[21,23],"tags":[],"class_list":["post-30193","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news","category-ethereum-news"],"jetpack_featured_media_url":"https:\/\/coinscreed.com\/staging\/wp-content\/uploads\/2022\/06\/ethereum-merge.webp","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/30193","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/users\/33"}],"replies":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/comments?post=30193"}],"version-history":[{"count":0,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/posts\/30193\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media\/30195"}],"wp:attachment":[{"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/media?parent=30193"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/categories?post=30193"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/coinscreed.com\/staging\/wp-json\/wp\/v2\/tags?post=30193"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}