The MakerDAO governance has reportedly granted authorization to the USD Coin (USDC) stablecoin, to be considered as the 3rd collateral kind supported in the Maker Protocol.

Specifically, the final approval was the result of a special vote not in the typical weekly schedule, as an urgent attempt to amp up the Dai (DAI) liquidity, in response to the unstable pattern displayed in the market a week ago. 

USDC will become the third stablecoin, along with Ether (ETH) and Basic Attention Token (BAT), to be recognized as collateral, eligible for opening vaults and issuing DAI. 

This initiative was rolled out not long after talks in the Maker community took place, regarding the merits of including USDC and the suitable risk parameters for the stablecoin. A public discussion has also been held, concerning the possible effect of recognizing one more centralized stablecoin as collateral. 

The community reportedly came to a conclusion that including USDC could work as a viable solution to dealing with Dai price instability and liquidity problems, which is getting serious rapidly following the Ether market crash. 

The Maker Protocol supports Dai issuance, via locking collateral into a smart contract or vault. The Ether price decline last week, which has never been recorded before, has driven the collateral kept in numerous vaults to a sub-level value compared to the DAI issued, triggering liquidations.

Despite the Maker Protocol has contingencies for incidents like this, the scope of the price drop has exceeded the functional capacity of those mechanisms, and one time liquidated collateral was auctioned off for 0 Dai.