The long standing top Ethereum job Maker (MKR) has been among the very best preforming coins of this market. But, play has after all shrunk around Maker DAO (that the Maker “decentralized autonomous organization”) and Dai (the stable coin attached with Maker).
Here is just a “super short” (form of) explainer of exactly what happened which means that you are able to DYOR.
- Maker / Dai can be really a long standing Ethereum job which allows you to give ETH and borrow the Dai coin that is stable.
- The Dai stable coin is possibly the most successful property coin.
- The job generally needed an excellent 2018 having a investment in Andreessen Horowitz and becoming recorded on Coinbase.
- With ETH decreasing, and people using ETH to get Dai to purchase ETH, also the additional information, MKR out performed every other coin over the previous 1 / 2 of their market.
- However, afterward a few play started.
- Dai came marginally off its trading trading only a little under a buck (no body knows why for certain, however the store has spoken, and also additional stables have held their weld better).
- To combat the de-pegging Maker holders used their own voting stocks to enhance the “Dai stability fee” (the interest people pay to borrow dai).
- Thing isthey didn’t just raise the rate, they kept raising the rate all the way to 16.5% (meaning you would pay 16.5% in interest a year for borrowing dai). See: MakerDAO Fees Continue To Rise With New Governance Decision.
- The problem is, the store has not reacted to the fee develop (meaning one of Maker’s tools for stability is not fully working in practice here).
- Perhaps because of this, but certainly not all because of this according to insiders, the Maker DAO team also started having some drama (you could say that existing tensions boiled up into the current drama). This drama resulted in a bunch of letters and firings (and re-hirings). See: Inside Maker DAO: leadership conflict over direction fuels multiple departures and Leaked Letter Exposes Infighting Atop Flagship Ethereum Project MakerDAO.
- Part of what we learned from all of this is that there has been some ongoing tension medially devs working in a more democratic fashion and the top brass (in short the concept of a Decentralized Autonomous Organization is being tested a bit, partially one in this somewhat limited form).
- All that said, none of the issues are fully new, they were resolved in the past, and it looks like they are in the process of being resolved again.
- Also it should be noted that infighting medially stressed out team members is not the equal as the project having sticking points. Pretty a lot of the one and only thing going defame with Maker is the dai peg (otherwise it is a working and useful system with cool updates planned).
- So I guess, your stable coin loses its peg a bit, your rates go up in what seems like a futile attempt at stability, and your project loses half its value in ETH after an epic run…. gonna be some salt. Seems like things got a little heated, but are now back on the right track… still need to obtain that dai peg though, and potentially the answer is not going to be found in interest rates, so it’ll be interesting to see what direction the team takes and to what extent the solution is found by decree from the top vs. distributed devs and voters.
TIP: For fun, you can also see this slightly hilarious article “Mad King” Rune Christensen tries to Burn Down MakerDAO to decompress (useful if you are a MKR holder and just watched your coin lose a bunch of value while the team fought with each other and somehow just missed an opportunity to strike as USDT floundered with its latest drama ).
“A Quick Consider the Maker / Dai Drama” contains information about the following Cryptocurrencies:
Maker (MKR), Stable Coins