I voted yes to Offboard USDT Collateral Types - September 27, 2021 .
A comment here. I agree with other delegates that I think how we are using greenlighting polls are such that in ‘most cases’ (see below) I am going to greenlight something so we can have this reviewed by CU teams before I am going to be able to say yes or no. In general I think there is a productivity hazard here. That if we basically greenlight everything it means CUs will have to do more work before governance can be informed enough to approve/deny a MIP6 application in particular. There is another hazard that MIP6’s once worked on will be expected to be approved otherwise the work will be a waste, so there will be a tendency to approve these vs. denying them I think this kind of workflow has a conflict of interest between productivity lost vs tendency to approve (so work done isn’t wasted). Some discussion around intentions for MIP6 greenlighting and initial work by CUs to only bring forward MIP6 candidates that governance can pass, vs. just bringing forward any and everything hoping somehow where bad candidates will be weeded out before the final approval stage is probably appropriate.
Which brings me to the next one I seriously was considering voting no on.
I abstained on Community Greenlight Poll - REIF-DROP (Commercial Real Estate Assets DROP) - September 20, 2021 like a large number of delegates (notice this one only passed because of one delegate @Planet_X with sufficient MKR voting power - there was another supporter @ElProgreso so it could have only taken two with combined 10K MKR if I remember right the amount needed to pass.) This is mostly because most delegates like myself voted to abstain. The primary issue here is this is a MIP6 related to adding more New Silver Centrifuge assets where @SebVentures has already flagged issues with an audit On-Chain Securitization Roadmap / New Silver audit - #5 by g_dip that as far as I know still have not been addressed.
Looking at how basically a single delegate basically can greenlight whatever they want here brings up a delegation hazard. I have often wondered whether delegates should only be allowed to have some maximum MKR delegated to them. The idea we could get one delegate with 50K or more MKR doesn’t seem as appealing as forcing this 50K MKR to spread between a number of delegates. More on this later…
Other notes. A 3 day poll came up that I missed due to two family situations. I would hope that in the future we could have every poll have at least a 7 day period as 3 days is likely too short if someone has family or health issues.
I missed the following poll Increase the System Surplus Buffer - September 20, 2021 .
I read the discussion here and have long been an advocate for increasing surplus buffer to at least 2-5% of outstanding DAI. One point I found interesting made by @cmooney
Buying while markets are dropping via using some fraction of the liquidation fees is really a great way to continue to burn. I would support a proposal to take some fraction (25-50%) of liquidations and flop with it.
It was the when the whole CU MKR compensation came up and enhanced by the whole legal issues around minting MKR for the compensation vest to cause me to consider altering the MKR buy and burn behavior for multiple reasons. A brief outline of what I have been considering proposing below.
I asked in various places (and now here) whether it would be possible @makerburn to get a chart of DAI the system has earned as a function of time since inception of the MCD system. What I am considering proposing is:
- Change when the system flaps MKR to using a signal like liquidations to use DAI profits earned in the period to buy MKR. Once this signal triggers:
- Provided DAI earnings are positive and doesn’t put the SB below some low water mark. Take some fraction F1 of DAI profit earned by the system in the period window and allocating it to buy back MKR (call this total MKR bought = BM).
- BM is used to fill required MKR vesting schedules for all CUs during the period etc. Lets say during the period the system bought 100MKR but 200MKR is needed to fill the vesting schedules. Then during this period this 100MKR would be split at a 50% level to all vesting schedules and a vesting deficit of 100MKR recorded. If for example the BM for the period was 400MKR then I would want to fill the vesting schedule with 200MKR and guaranteed burn some fraction of the extra 200 (say 50% which would be 100MKR here) and then set aside the remaining 100MKR into a MKR vesting fund to fill any future vesting holes via some vesting deficit filling model.
Doing (1-3) above accomplishes a number of key goals for Maker.
- Makes the MKR compensation vesting system - sustainable long term.
- Ties all MKR vesting to system profits. When the system doesn’t make DAI - no-one gets any MKR (they just build up vesting deficits to be made up later when the system earns more or partially filled via a MKR vesting deficit fund increased when system profits were high in the past.)
- Some MKR is purchased on the market based on the Fraction F1 of the DAI profits rather than a fixed SB buffer limit. This will basically set the MKR price for vesting for the period as well vs. using some made up number based on average price for the period. It will be an actual cost to the system in DAI which matches the DAI value given the the compensation via the vest.
- Completely eliminates ever having to mint MKR for vesting schedule.
- If MKR purchased exceeds the MKR vested there is a guaranteed burn component.
- Aligns the interests of everyone for the system to be profitable. No-one gets their full vest component unless the system earns enough DAI to purchase enough MKR to fill the vest, and then and only then will the system guarantee burning some MKR no matter what the SB buffer level is. (this behavior can be altered if the SB buffer gets too low btw).
- If the SB ever hits the high water mark then basically all MKR purchased goes through to vest and build a buffer to vest and some fraction will burn. (this will be a reason to just punch the SB up to a reasonable large maximum value as a % of the outstanding DAI and just leave it there permanently).
- Part of the 84K MKR can be put into the vesting accumulator to provide for an initial MKR deficit filling fund.