Real-World Assets - Report - 2021-05

I don’t decide, MKR holders are. I’m negotiating for terms with New Silver but the community can fix them as they want or liquidate the whole thing.

A maximum average of 75% and 15% of the exposure in 85-90% LTV does seem okay to me personally if there is a business reason and if New Silver increases their TIN exposure like they are currently. As much as I like numbers, I like to understand the real risks, they are taking risks with their equity so I would start there. Numbers are usually just an approximation of a more nuanced situation.

But is the exposure 85% or 90%? If 90%, when were MKR holders notified of the change and where is the approval? I don’t see 90% written anywhere outside of this thread, apologies if I missed it.

To be clear, I don’t remember this going up for any kind of poll:

the executive document was updated to 90% max LTV

Two quick points, Seb. One, how was New Silver unilaterally able to make the change above?

Two, does anyone on the RWA Committee have a financial interest or investment in New Silver?


There wasn’t, but I agree that the AO should change the terms only after MakerDAO approved them (which makes more sense at least). The Centrifuge way is that if you don’t agree you redeem your DROP token.

Two quick points, Seb. One, how was New Silver unilaterally able to make the change above?

We might have discussed the point, but I didn’t understand the implications and New Silver probably thought it was enough. I see it as part of the learning process.

Two, does anyone on the RWA Committee have a financial interest or investment in New Silver?

I have a few DAI in the DROP token. No one else in the RWF CU nor in the RWA Committee has declared any investment in New Silver (@_LS isn’t able to vote on Centrifuge assets).

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What do you mean “you agree”? You are the real world finance facilitator. This is your job. Did NS tell you that they were going to change the agreement? Did you approve it without notifying MKR holders? Either way you just allowed an originator to unilaterally change a material term in the agreement and (apparently) there’s absolutely nothing you can do about it, because as I’ve been saying for a long time, this is a piss poor structure. They were also able to do so without any kind of oversight from MKR holders, which should have been a non-starter for this entire concept and is what you should have been enforcing as a mandated actor. Also why don’t you go ahead and try to redeem our DROP? Let’s see how productive that route is. This whole thing is a complete joke.


I believe they need to provide 2 weeks notice to do that, under 4.F of the main agreement. Was the DAO informed of this when RWF received notice? Or did New Silver neglect to provide the notice?

Think it’s time for another decorum reminder…

Remember we are discussing the ideas, not the people behind them, and Good Faith should be assumed in all interactions until there is ample reason no to trust the intentions. This is not one of those exceptions IMO.

There are some questions to work out with this latest update but let’s focus on the content of the questions and what clarity we desire from them. I understand that you are upset with the structure @g_dip but I think it’s important to highlight here that this is a structure approved by MKR voters and executed according to their wishes by Seb. There are plenty of governance tools we can use to reevaluate this structure and I’m happy to assist with providing different options that you might want to peruse. Let’s all take a deep breath and remember we are on the same team, despite any differences in opinion.


like removing a facilitator? can a core unit have no facilitator?

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I suspect it would need to re-form under a new entity, unless the legal entity is sold/given to someone else. The DAO doesn’t own any companies/LLCs/corporations/partnerships.

Yes, important point: MKR voters agreed to this. If the setup is bad, the responsibility is ultimately on MKR voters to make sure future RWA structures don’t have these flaws and if possible adapt to the facts of the current one.

I don’t spend a lot of time looking at RWA and I guess there are a few people like me – @SebVentures I would be very interested in a breakdown of 1) What happened 2) How big of a hole in the structure does it reveal in your opinion 3) What changes to the RWA onboarding process you’d make, if any, to avoid that in the future.


I think the first thing we need to determine is if 1) New Silver gave us the 2 weeks notice as required, and if so, 2) why we are only hearing about it now.

Indeed, I’m doing my best to facilitate and help MakerDAO in the topic that falls under my mandate by trying to understand what the MKR token holders want (which is really the hardest part of the job).

According to the CU MIPs, you can submit a Signal Request to tell me to stop dealing with RWA.

You can remove me as Facilitator, it’s not a problem for the RWF CU, it’s mainly managed from the MakerDAO RWF CU multisig. I can understand the individual positions, but I’m working for MKR token holders.

There is this fancy trend to fire me lately. For those that are entertaining this idea for weeks, please do or don’t. I’m here to do work, not politics. The work is already hard, the rest is just exhausting.


I think you might be misinterpreting what happened. MKR voters did not agree to allow a core unit facilitator to unilaterally approve changes to what is effectively the collateralization ratio of the Vault. To my knowledge, no core unit is vested with that power. Additionally, there has been an outright refusal to share the deal-specific documents (akin to the smart contracts in a crypto-vault), so the MKR voters had no way of knowing that this was even possible and trusted Sebastien to ensure their interest were adequately represented. I am all for getting along, but this isn’t a game and I’m seeing 0 accountability being taken here. This is real money at stake and this isn’t the first time these concerns are being raised - and somehow still being ignored.


That’s a constructive way to frame it.

  1. NewSilver changed the conditions of the Tinlake Pool following the contractual DROP agreement. We focused on the APR change (that doesn’t change anything for us) and maybe missed the change in the LTV. Maybe we talk about it and didn’t seem important at the time (which would be a mistake). It was detected during the monthly audit as there are here for that. The Centrifuge model is “a posteriori” as the assets are small and need flexibility.

  2. I would frame it as minor as we can always liquidate which would freeze the pool assets anyway. The fix would be to disable the ability to change after the launch.

  3. We need a more formalized covenant being signed by the AO and be upfront that it will be followed. And even put in the Tinlake Agreement directly. At some point, we can even use the on-chain data to trigger liquidation directly. For that, we need to have the tooling to even let the originator to understand the impact of adding an asset (not needed for the LTV). Adding rigidity will decrease the speed of onboarding and even remove applications. This is why I think size is important to take into account. We need to find the best solution.


First I think we should thank Seb to have highlighted it and noticed it.

The ltv is still under the initial setup.

Now, I would ask this question to our facilitator:
What can we do?
What should we do?

Are we too invested into it?
Are we too invested into centrifuge?
They currently have 20M debt, can we have more than 10 percent of the full debt?

Edit : thanks for disclosing all your financial interest or investment. That should be seen as a good practice across all CU too.


The only way to learn what not to do is by getting burned a few times so we have to be mindful that mistakes will be made and that we signed up for it. Moving forward we can learn how to properly structure these deals.


This :point_up_2:t4: “You don’t achieve your dreams by playing it safe, you do it by taking intelligent risk” -Mike Maples, Jr.



Not to beat a dead horse, but either 1) New Silver did not inform us of the changes, or 2) the DAO was not informed that we were given notice of material changes to terms.

I don’t think we can draw any conclusions until we establish which of those two occurred. Or is there another possibility I am not thinking of?

Can anyone tell us which one occurred? Pretty please?


Greg, this is a step too far. You are making things up. I don’t have such power. And am I not reporting things? Did I not create the RWA Committee to advise the Maker Community?