In the past week, MakerDAO has experienced a drop in total value locked (TVL), the supply of DAI, and annualized fee income, signaling some potential trouble for one of the world’s largest stablecoin issuers.

Additionally, MKR’s value decreased by 25% during the same timeframe. Despite DAI’s recent return to parity with the US dollar, there is growing uncertainty about whether it will remain pegged, causing a decline in MakerDAO’s TVL over the last seven days.

On-chain data suggests that MakerDAO’s decrease in asset value can be traced back to a reduction in collateralized loans on the platform. This drop in loans appears to be driven by concerns about the sustainability of the DAI stablecoin, which in the past week has seen a 13% decline in supply, per Marker Burn data.