Delegate Communication 20211113_1221UTC
Add WBTC-B as a new Vault Type - November 8, 2021 - voted YES because this supports my thesis (posted long ago) regarding having multiple vaults on the same collateral type to allow markets to decide their risk exposure, rate they will pay and to manage DC. These types of vaults allow for a more staggered liquidation should prices drop.
GUNIV3DAIUSDC-A Parameter Adjustments - November 8, 2021 - voted YES even though PSM tin/tout to 0 over time is going to kill fees here. Mostly because I am expecting the DAI PEG to break 1 - and will bring fees back. The use of this vault is going to depend heavily on whether Maker can maintain PEG at 1 or not and fees.
NS-DROP Covenant Modification - November 8, 2021 - voted NO on these changes. Simple upshot here is that while work is being done to correct issues with Centrifuge structure until the structures are more suitable for Maker (for example a senior secured credit agreement seat) there is a general consensus not to modify these to/and/or extend new credit. There are significant issues going on with RWF in general well that are creating additional opacity making these difficult to deal with.
Recognised Delegate Compensation Increase - November 8, 2021 - voted YES Even if I wasn’t a delegate I would have voted my MKR for this. I believe the work being done by delegates justifies the compensation. I do believe given the level of compensation there should be a solid set of measurable requirements. I am also concerned that there is no cap on MKR that can be delegated to a single delegate.
Increase the WSTETH-A Debt Ceiling - November 8, 2021 - voted YES to the increase here. We really want to encourage collateral that earns return.
DIRECT-AAVEV2-DAI Parameter Adjustments - November 8, 2021 - voted YES to the increase here. I have wanted Maker protocol to take advantage of earning return on DAI and this is one of many ways. I do have concerns over implications on liquidity, security and if DAI runs off PEG.
Executive: Parameter Changes, Return Unused Budget to the Surplus Buffer - November 12, 2021 - Supported Increases GUNIV3DAIUSDC-A DC from 50 to 500M, decreases the LR to 102 - basically going to 50x leverage from 20x. SF decreased from 1% to .5%. I am positive on these types of vaults for multiple reasons. One thing to point out is that this v3 liquidity is concentrated into a very narrow band. If for any reason the PEG drops below this band this LP will earn no fees and people will need to reposition. While unlikely to see a 200bps drop DAI below PEG here could cause this vault to become under collateralized. Hence like all the stablecoin vaults that have stablecoin values PEGGED to 1 create some systemic risk should underlying stablecoin collateral drop significantly below $1 for any reason.
WSETH-A DC increase - very much needed and likely will be used.
AAVEV2-DAI Aave D3M - While there are some hazards at least the protocol is now earning fees using DAI in these DeFI projects. About time honestly.
It was nice to see some surplus budget returned tot he surplus buffer but as can be seen later there are some CU accounting issues to be addressed.
USDC PSM down over 250M in past 5 days. Puts us on track to empty by year end.
Also concerned over the turmoil going on within the RWA unit around @SebVentures and Cenrifuge slowing down RWA growth
Beyond this we are about to hit top end of surplus buffer and DAI holding at 8B earning over 1% in aggregate.
Community Greenlight Poll - MDI (MD Irradiance LLC) - November 1, 2021 - probably going to abstain as I agree with Paper the process around these greenlight polls needs to be changed.
Community Greenlight Poll - OHM (Olympus DAO) - November 1, 2021 - still a No on Olympus OHM.
Ratification Poll for Adding the Deco Fixed Rate Core Unit (DECO-001) - November 8, 2021 - Honestly there are so many issues around Deco. If this unit came on as a parallel PECO to work on what governance wanted and set aside this fixed rate stuff I would be more supportive. Setting aside my issues around fixed rates:
- Maker can fix rates all by itself. It doesn’t need to do this in the protocol
- Maker by creating fixed rate instruments increases the likelihood of regulation being applied to the protocol.
- Won’t do dink to get us out of the rate issues in the Impossible Trinity
Put simply this particular deal basically gives Deco a huge benefit from the protocol, while the protocol takes on all the risk. No government, no institution would give away so much to get so little and take on such risk. As structured Deco is a bad deal for Maker. This idea that if we don’t do it, DECO will be upset and take their marbles off the table is concerning to say the least. It is as if some inside deal was done here and governance is just supposed to rubber stamp a yes. I have various folks both inside and outside Maker lobbying me on both sides of this deal with valid reasonings. I am still willing to hear a cogent argument for why this is good for Maker vs. what we lose if we don’t do it. I have never liked a business deal which was a lose-lose proposition if I didn’t do it. Tells me the deal is structured badly because in any good deal saying no just means things stay the same (no-one loses - we just don’t gain).
Ratification Poll for Supplement to Collateral Onboarding Application (MIP6c3-SP1) - November 8, 2021 - Going to support with YES this. Don’t know what I ended up at the first time I looked for this but after finding this and reading it a resounding yes.
Ratification Poll for the Immunefi Security Core Unit (IS-001) - November 8, 2021 - Leaning to YES here mostly based on discussions with other CUs etc. We need to grow a bit more with manpower and this unit will manage some other key MakerDAO issues. Really want to see expenses come in line. Particularly the MKR vesting since we are seeing MKR being vested for unfilled positions in a number of CUs now.
Ratification Poll for Modify Core Unit Budget, RWF-001 (MIP40c3-SP39) - November 8, 2021 - First glance is to support this because we really need RWA to get moving and I see this CU as needing really qualified and experienced people and these don’t come cheap. Honestly moving to side with PaperImperium here regarding wanting these to be resubmitted with MKR vesting for current positions not vacant ones.
Ratification Poll for Modify Core Unit Budget, COM-001 (MIP40c3-SP40) - November 8, 2021 - Probably going to support this.
Ratification Poll for Real-World Finance Core Unit MKR Compensation, RWF-001 (MIP40c3-SP38) - November 8, 2021 - in principle for MKR compensation but I don’t like seeing this vesting for empty positions. I also would like MKR compensation to be tied to net DAI profits and MKR being continually purchased from these profits and held to fund DSSVest.
Ratification Poll for Modify Core Unit Budget, MKT-001 (MIP40c3-SP33) - November 8, 2021 - Generally going to support (same comments as above). Still looking at budgets somewhat.
Ratification Poll for Adding Sidestream Auction Services Core Unit, SAS-001 - November 8, 2021 - Yes here as it is my hope to have a single unit looking over all the details of auctions. My issue here is this unit appears to have a analytics cost component that I would expect should be offloaded to the Analytics CU. We really need to focus all data analytics needed for CUs through this CU vs. everyone doing their own stuff. This is also true of UIs.