[Agenda/Discussion] Scientific Governance and Risk - Thursday, August 15 9AM PST (4:00 PM UTC)


Governance Segment

  • Richard Brown: Reviewing the new Governance Facilitator role proposal, answering questions.
  • Someone will discuss ‘Governance at a Glance’

Risk Segment

General Q&A

We’ll open the floor for any questions about Scientific Governance and Risk.

Please join us and help shape the future of the MakerDAO.


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Episode 48: August 15, 2019


  • 06:30: Intro from Rich Brown
  • 39:33 : Recap of Forum Topics from LongForWisdom
  • 42:48: Review from Primoz
  • 54:51: Analysis from Vishesh
  • 01:02:34: Post-Call Discussion


Summary & Introduction 06:30

  • Give us feedback about the call.

Interim Governance Facilitator 09:20

  • Read more about the role here
  • The role of the Governance Facilitator already exists, but is not formally defined. Currently, Rich is living in this role that involves moderating and facilitating Maker Governance.
  • This is a proposal that formalizes a detailed individual role. The community must decide if it agrees with the way the role is described. This will be discussed on the forums and polled for there initially.
  • As part of the greater roadmap, the introduction of this role is meant to formalize it in the eyes of Maker governance. We need to formalize roles to make sure the Governance Community can live on in the absence of facilitation by members of the Maker Foundation.
  • Interim Governance Facilitators (IGFs) are tasked with ensuring the smooth operation of the governance process. This involves anything from general administration to signals gathering to governance scheduling, and more.
  • Primary Responsibilities:
    • Ownership and Management of the Official Communications Channels: Setting tone, removing trolls, surfacing conversations, etc.
    • Defining the Governance ‘Problem Space’: detailing and helping the community to tackle the hard problems
    • Making sure Governance is following the community mandated procedures
  • The Maker Foundation wants to community to come in and assume these roles and give feedback on what needs to be changed. If the community doesn’t step in, the Foundation will end up leading the way in how these things are defined. Campaigning, advocating, and recruiting for this open Governance community is important for this very reason.


  • 19:20: Since posting the thread, what has been the main concern or criticism?
    • Main concern is that there is a lot packed into the role. Voting for all of that or none of that might be jarring. We want to identify the specific problemed points if the community spots any.
    • Lack of clarity about what the term “ratified” means, since we haven’t gone through the process of ratifying something like a risk team. It references processes that haven’t been defined yet.
  • 23:13: What problem does this role solve?
    • This is primarily about bootstrapping. We need a Governance Facilitator to keep the different aspects of Governance in-line with the structure we are creating for ourselves. Without a facilitator it is very hard to be organized.
  • 29:44: Do we expect this to be a permanent role? Or is it part of some bootstrapping phase?
    • I can’t say. It can happen that in a few years the community has worked out that the role is no longer necessary.
  • 30:48: How does Governance move forward if the Governance Facilitator gets sick or something. How do we ensure coverage?
    • This a question for the Governance Facilitator to figure out. This is part of defining the ‘problem space’.
  • 35:29: Is there compensation for this role, or is it purely voluntary?
    • We are in a transition phase for MakerDAO, and this will be a question for each mandated role. Until we have a more clearly defined mechanism for disbursement of proceeds from Stability Fees, everything is going to be covered by the Foundation itself. We hope that post-MCD launch we will have these mechanisms in place.


Forum Activity Recap 39:33



Do falling collateral amounts in DeFi mean bearishness?(No) 42:48

  • Research based off the question found in this tweet
  • Associated article by Primoz
  • I wanted to show that DeFi is actually at an all-time-high. The “amount locked in DeFi” metrics are representative of risk, but not of actual usage of DeFi services.
  • Median amount of ETH locked in CDPs is a better metric than overall, since it filters out individual whale activity which is outsized compared to the rest of the usage.
  • Loans outstanding in DeFi are at an all-time-high
  • If you want to measure DeFi usage, its metrics like these that you need to look at, not the amount of collateral locked.
  • If you want to measure usage of Dai, that’s a completely different story. You want to focus on actual on-chain activity of Dai.
  • There is a difference between nominal ETH amounts versus dollar value of underlying collateral locked up.
  • 51:21: Cyrus - The takeaway is that if you want to measure the growth of the DeFi space you want to try to isolate metrics or use metrics that better isolate usership and growth. Collateral value itself is subject to unrelated factors like asset price and whales moving outsized amounts of collateral.
  • 56:05: Additional commentary from Vishesh

Vishesh: Dai Analytics 54:51

Relevant links

Santiment Maker Data
Graphs about Maker
Graphs about DeFi Loans
DAI 24hr VWAP Graph

Dai Price: 54:51
  • The state of the peg is broadly good. There’s been a huge trading volume over the last couple of days.
  • Most trades were just above or just below a dollar.
  • The Volume Weighted Average Price has been slightly above a dollar.
  • A big portion of this was selling of ETH for Dai, which tends to stabilize the Dai price. Some of this volume was a result of nearly 1MM in liquidations in the past 24hrs.
Dai Supply: 56:53
  • The Dai supply has been relatively stable at around 77-78MM.
  • The question is, “is Dai losing market-share?”
    • Continues answer in the context of Secondary Lending Platforms.
Secondary Lending Platforms: 57:35
  • Dai borrow volume has come up, but so has the excess.
  • We saw a cratering of the excess from July to August, as a result of the InstaDapp Compound bridge. It has since bounced back.
  • Utilization rate has come down with the Dai supply. This shows us that there is less demand for leverage, and therefore Dai. The question is, “is this being caused by Compound? USDC?”. Not necessarily. I think it’s a function of ETH price right now more than anything. This should improve since as ETH price gets cheaper we will see an increase in leverage on ETH.
  • On-chain Dai volume has remained very strong, as mentioned by Primoz, so it is being used. The supply drop seems to be the closing of leveraged long positions by a portion of the market.
  • What’s interesting is what MakerDAO will do with the rates. We see the SLP borrow rates have come back down, in tandem with a lowering utilization rate. So now there is a bit more excess that exists on SLPs.
    • Governance could try to lower the Stability Fee in an effort to make leverage look more attractive now.
    • With Dai’s consistent stability, it may have the room to accept a slightly lowered Stability Fee.
  • As the spread between SLP borrow rates and the SF widen you will see more oversupply captured in the form of excess liquidity not being actively lent out.

Questions to Vishesh + Post-Call Discussion

  • 01:02:09: Is it possible for us to see a 7-day Volume Weighted Average price for these calls?
  • 01:02:34: One of the questions we’ve been pondering is when have we reached the point of harmony between Dai supply and demand?
  • 01:13:02: If more Dai made it onto the market, would there be a demand for it?
  • 01:19:15: Discussion around DSR, Risk Premium, and the methodology for starting DSR values.
  • 01:21:10: Discussion around the calendar proposed in the Interim Governance Facilitator Thread

Links from the Chat


wow! great recap! very clear indeed

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This call’s Visheshism of the Week: “Once is happenstance. Twice is coincidence. The third time it’s enemy action.”