Any Ethereum-based asset that has been approved by MKR holders can be used as collateral to generate DAI. At time of writing, MKR has not been approved and many in the Maker community believe it would be unsuitable. This is because MKR’s role as a recapitalisation resource makes it a collateral of last resort when falling prices lead to Vault liquidations. Using MKR as collateral in a Vault that gets liquidated could therefore potentially lead to a negative feedback loop that applies downward pressure to MKR price.