• MakerDAO’s community voted to keep the Gemini USD (GUSD) stablecoin as part of its reserve system for its DAI stablecoin.
• 50.85% of the votes favored keeping the GUSD debt ceiling at $500 million level in Maker’s Peg Stability Module (PSM), while 49.15% voted for decreasing to zero.
• Venture capital firm ParaFi Capital seems to have delegated just enough voting power in the last minutes to flip the end result.

The Decentralized-finance (DeFi) giant MakerDAO put its community to the test this week in a vote to decide the fate of the Gemini USD (GUSD) stablecoin. As part of the Maker’s Peg Stability Module (PSM), GUSD had a debt ceiling of $500 million, but with a narrow vote of 50.85% in favor against 49.15%, MakerDAO decided to retain GUSD as part of its reserve system for its DAI stablecoin.

The result averts near disaster for Gemini’s stablecoin, as MakerDAO holds 85% of all GUSD in circulation. As the vote progressed, the results seemed to be leaning in favor of removing GUSD from the PSM, but with a dramatic reversal at the finish line, the future of GUSD was secured – at least for now.

According to blockchain data and information on MakerDAO’s governance forum, the deciding factor seemed to be the last minute delegation of voting power from the venture capital firm ParaFi Capital. With their input, the votes in favor of keeping GUSD exceeded those in favor of decreasing the debt ceiling to zero.

The largest delegate in favor of keeping GUSD with 13.9% of all votes was GFX Labs, which received 10,000 MKR tokens representing 7.5% of all votes in two transactions from a wallet address named after ParaFi Capital’s CEO, Eric Berg. This was enough to sway the outcome and secure the future of GUSD for the time being.

All in all, the close vote was a testament to the power of decentralization when it comes to making decisions on important financial matters. MakerDAO’s PSM had to consider a variety of factors, including the potential impact of removing GUSD from its reserves, and it is clear that the community was able to make a well-informed decision in the end.

For Gemini, this result is a relief, as the future of their stablecoin was in question prior to the vote. However, with the debt ceiling still at the $500 million level, Gemini will have to remain vigilant in order to ensure that they don’t overshoot their reserve capacity.

For MakerDAO, this result is a reminder of the importance of having an engaged and informed community when it comes to making decisions, especially when it comes to finance. They will have to remain watchful, as the future of GUSD could still be in question if the reserve capacity of the PSM is exceeded.