French Bank Societe Generale Uses MakerDAO To Withdraw $7M DAI

• French Bank Societe General withdraws $7 million worth of DIA from MakerDAO.
• This is the first time, the banking giant used the vault since August 2022.
• MakerDAO’s vault is backed by 40 million Euros worth of OFH tokens.

French bank Societe Generale with over 138K employees, across 62 countries, has accessed its MakerDAO vault to withdraw $7 million worth of DAI from MakerDAO’s vault. This is the first time the bank has withdrawn DAI since August 2022 when MakerDAO added the bank to its digital asset-focused subsidiary.

When Societe Generale was added to the DAO’s vaults, the credit limit was set at $30 million in DAI according to a unanimous vote with support from 96,551 MKR. Meanwhile, the vault is endowed with 40 million euros in bonds in the form of tokenized securities issued on Ethereum, which is the OFH tokens.

Moreover, the MakerDAO vault is backed by overcollateralized loans based on Moody’s AAA rankings.

However, the entire process dates back to October 2021, when SG Forge undertook the task to convert borrowed DAI into USD. The goal was to offer Societe Generale the converted funds as a loan in exchange for the OFH tokens.

Since the tokens have no liquid market, in case the loans ever end up undercollateralized, the liquidation process for the OFH tokens will be more manual compared to MakerDAO’s other collateral vaults.

While SG Forge’s first withdrawal has been slow, MakerDAO’s delegate and crypto researcher Mika Honkasalo said that he expects the bank to withdraw its maximum $30 million in DAI “soon.” He shared:

I’m not actually sure why it took them so long to use the vault, except that my experience with these real-world asset things is that everything always takes a long time.

MakerDAO’s goal is to rise DAI stablecoin’s collateral base to shift away from the volatility that crypto offers. Societe Generale’s initiative with the DAO is thus very fruitful to the web3 company.