I want to continue the conversations started here and elsewhere to talk around business strategy and build on @SebVentures Crypto Banking 101 article in the interest of providing some framework for the discussion. Seb’s article concludes with the question:
“How do you manage your balance sheet to meet the constraint of solvency and liquidity while optimizing the spread between founding and investment rate?”
The merits of promoting MakerDAO as a crypto bank may be debatable (and I’ll come back to that) but the mechanics at play in MakerDAO appear to be consistent with that of a bank, as Sebastien has defined it.
If we accept this, then we can start thinking about what it means to optimize our spread.
In other words, how do we increase the supply of, and demand for, Dai? Adding new collateral types and raising debt ceilings increases supply while demand grows through B2B integrations and the development of B2C markets.
What types of value have been realized through B2B integrations and which types of integrations currently hold the most potential value?
Similarly, what types of value have been realized by building B2C markets and which types of efforts currently hold the most potential value?
It’s worth remembering that it’s easier to see the value in existing markets than ones that have to be built, particularly with regard to B2C.
We may generate more money in the short-term by tapping into existing markets but the network effects in building new ones could have long-term returns that dwarf the value of those potential short-term gains.
In any case, I think it would be particularly interesting to hear from @Nadia and the Growth team as well as the rest of the community about where we’ve seen successes we can double down on.
- To what degree should we publicly discuss business strategy?
This question is ultimately about treasury management and I see two sides to that coin:
How do we effectively organize and manage a workforce?
What’s the best way to manage risk while maximizing the returns on our treasury?
We’re navigating #4 by addressing issues around this transition to the Core Unit model. Are there things besides MKR vesting we might want to standardize across Core Units or other issues worth addressing?
I’ve heard @NikKunkel talk about leveraging our oracles and been curious myself about what sort of opportunities might lie in our networks of people and companies supplying digital and real-world assets.
What’s the next step for the reserve asset of the Web3 economy? Barter? Insurance? VC? I don’t expect detailed answers but it might be helpful to think about how to tackle this question: do we need a Core Unit or Working Group to explore this topic?
Optimizing our spread is critical but it’s also worth considering what effects any strategies we pursue could have on things like the value of our brand.
In my experience, “Banks/corporations suck” is a popular narrative with certain audiences and especially those in crypto but it also comes off as immature to others.
Fortunately, we have the freedom to be a bank in the ways we want to be a bank and be whatever else we want in the ways that we don’t. So, what do you think we should be?