So as most of you are aware (and probably expected) there is some level of backlash against MakerDAO adding USDC as collateral. This came up in the governance and risk chat today.
A number of us used a novel method of consensus building in the #consensus-test channel on rocket-chat to generate a list of talking points that can be used to help combat disinformation and hopefully accurately communicate intentions (as far as is possible in a decentralized system.) The output of that process is below:
Due to the unprecedented situation in markets, both traditional finance and crypto, DAI went through a major liquidity crisis. Due to the massive demand for DAI liquidity the price spiked to $1.08. To help improve DAI’s liquidity and to keep MakerDAO functioning through future market movements, the MKR community chose to add a maximum of $20 million of Dai issued against USDC collateral*.
Dai liquidity is important for two main reasons. Allowing keepers to participate in auctions, and so that Vault users can close Vaults without paying an excessive premium on Dai.
We are aware USDC comes with regulatory and blacklist risks. Due to these risks, we intend for USDC to remain as small a percentage as possible while maintaining Dai liquidity.
MKR Holders have the capability to remove USDC as a collateral type or lower the debt ceiling in the future.
With the 20% SF on USDC there will only be a large incentive to mint Dai using USDC during times of liquidity crisis where the Dai/USDC arb is profitable. We expect to see Dai minted from USDC collateral to be close to zero outside of these times.
Here’s a poll where you can agree / disagree with these points. Comments are of course also welcome. Poll is multiple choice with 2 max options to allow people to signal agreement/disagreement mixed with conflict. Edit: Nope I didn’t double check and max options is 3. Oh well.
- I agree with the above listed points.
- I disagree with the above listed points.
- I am conflicted on the above listed points.
*Edited due to factual inaccuracy. Previously this was: 'USDC collateral to the existing collateral pool.'