Maker Relay Ep 6

Maker Relay 06

Maker Relay Episode 06

Hey everyone, thanks for checking out Maker Relay!

Whether you hold Maker (MKR) or DAI, own a vault, or want to get more involved in MakerDAO governance, this is your one-stop-shop for updates on the MakerDAO ecosystem.

Votes

Executive Votes

There was a lot of executive activity last week to move the Dai peg back toward equilibrium.

Most recently, the Base Rate was reduced and DyDx was whitelisted on the ETHUSD Oracle

On Thursday, the Dai price was relieved when the debt ceilings were adjusted:

  • ETH-A increased from 260 to 340 million
  • USDC-A increased from 80 to 140 million
  • USDC-B increased from 10 to 30 million
  • W-BTC increased from 20 to 40 million
  • BAT-A increased from 3 to 5 million

On Tuesday, the Monthly Governance bundle was ratified which included an increase the ETH-A Debt Ceiling from 220 to 260 million and the following proposals:

Proposals

Sub-Proposals

Governance Polls

Last Weeks’ Meta Parameter Polls

Poll Name Vote Discussion Results Unique Voters
Base Rate Adjustment Vote -4% 23
Adjust the TUSD Debt Ceiling Vote Signal Request Fail 18
Adjust the WBTC Debt Ceiling Vote Signal Request Pass 19
Add dYdX on ETH/USD Oracle Vote MIP10c9-SP5 Proposal Pass 15

Closed Community Greenlight Polls

Community Greenlight Polls for new collateral closed on 2020/08/03 at 0400 UTC.

Collateral MIP9 Poll MIP6 Application Result Unique Voters
PAX Vote Application Pass 17
WIV Vote Application Fail 13
EURS Vote Application Pass 34
LRC Vote Application Pass 14
renBTC Vote Application Pass 30
AMPL Vote Application Fail 23
HUSD Vote Application Pass 12
USDT Vote Application Pass 22
C20 Vote Application Fail 8
BNT Vote Application Pass 24
COMP Vote Application Pass 21

Signal requests

MIPs Updates

The Maker Improvement Proposal (MIPs) Framework provides a clear process for Maker governance to change the Protocol as needed.

This is Week 1 of the August governance cycle.

Proposals in the Request-For-Comments phase include:

Current Events

Debt Ceiling Raises

Last week saw two Governance and Risk meetings (7/29/2020 & 7/30/2020) focusing on raising the debt ceiling and risks to the system.

Demand for Dai from yield farming is putting pressure on the Dai peg, which went down to 1.01 but currently hovers around 1.03. The debt ceiling was recently raised and its capacity was utilized in ~48 hours.

These raises create a significant amount of tail risk for MakerDAO with so much ETH and USDC collateral in the system. ETH creates liquidation issues in a market crash and USDC has some centralization concern.

@hexonaut added a thread to articulate base rates and the poll winner was a move to -4% which passed on Friday’s executive vote.

MIP17 - Debt Ceiling and Risk Premium Adjustments

MIP17 Working Group Community Call Summary & Action Items from MIP Editor @charlesstlouis:

“MIP17 was initially rejected from July’s Governance Cycle due to both the solution’s timing and the lack of consensus towards it being the clear path forward for Debt Ceiling and Risk Premium Adjustments.”

The current plan is try and re-architect for two different MIPs: altering MIP17 for simple Debt Ceiling Adjustments and a future MIP for Risk Premium Adjustments.

The team is hustling to get MIP17 revisions in before this week’s Governance cycle begins. Respond to the thread or message @charlesstlouis if you want to help.

Domain Teams

Smart Contracts & Risk

Token Smart Contract Assessments

State of the Peg

As of 08/03/2020

  • DAI sitting closer to 1.015

  • Over the past week Dai supply has gone up approximately 100 million.
  • Total Dai supply sitting at 378,527,154.

  • Volume at around $148 million last week.
  • Average VWAP price places Dai at $1.021

  • Past 24 hour volume at $24 million
  • 24 hour VWAP price at $1.015

  • ETH vaults are fanning out into stronger collateralization ratios.

  • The first significant liquidation wall is at $267 ETH, at writing that would coincide with a a 33% drop from current price.

  • Another large liquidation wall at $239 ETH. A 40% drop would mean 106 million Dai being liquidated.

https://daistats.com/#/ | http://dai.descipher.io/

Community

Articles and Thought Pieces

Videos and Podcasts

Twitter

InstaDapp Launched a Dai-short tool

Maker Forum Deep Dai-ve

Peg Stability Mechanisms

@Kurt_Barry summarized the Target Rate Feedback Mechanism (TRFM) in this forum post:

MIP20 describes a Target Price Adjustment Module called Vox. Vox is an implementation of a TRFM that adjusts the target price of DAI according to a governance defined rate, allowing the institution of negative effective interest rates.

@equivrel notes that Kurt’s introduction doesn’t address the implication of changing the Target Price for monetary policy (from the current target of $1.00).

@FourthStreet summarizes the state of discussions around the PSM in in What?, So What?, Now What? PSM Solution:

“How does MakerDao scale while also defending the Peg and restoring confidence in the system in a manner that is sustainable and limits exposure to collateral risk (mainly USDC is the current focus)?”

FourthStreet goes on to describe four major cons with current plans for the PSM to open discussion on how the issues might be mitigated.

Meetings and Events

MakerDAO Open Calls

Community Call

Community Collateral Onboarding

  • Wednesdays at 17:50 UTC | Zoom - Message #governance-and-risk in Maker Chat for password

Governance & Risk

Community Events

Hackathons

Reference Links

Discuss and debate Maker governance in the Forum and over Maker Chat

Propose technical changes, poll, and vote in the Governance Portal

Learn more about the Maker protocol in our Documentation

Have Feedback?

We value your input! Post in the forum, take our survey, or join us in the Community-Development channel to let us know what you want to see.

Disclaimer: This update is assembled by a group of contributing members in the MakerDAO community. This does and should not serve as financial advice or an inducement to vote in any specific way. This update is purely for informative and for communications purposes only.

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