April 2021 reporting for Real-World Finance Core Unit
Our current strategy is to onboard $300M of real-world assets. While the long-term strategy is to simply invest in senior tranches of structured products rated by credit rating agencies, we recognize that it’s not currently possible in DeFi. We have a two-path approach. First, partnering with Centrifuge, we work on a smart-contract way of investing in structured finance. Second, we are investigating a Trust-based way to invest the MakerDAO balance sheet in the real world using real-world tools.
We also think that having a strong capital base (i.e. surplus buffer) will be important to disrupt the traditional finance world. As we recognize that people prefer to burn MKR while it’s seeing as cheap, we also work to inform the market and the community on the financial strength of MakerDAO. We think that if the market recognizes the financial prospects of MakerDAO, the MKR price will increase, giving more opportunity to consolidate the capital base. Such knowledge will also help Maker Governance make more scientific decisions.
New Silver was successfully onboarded and accounted for $588k loans at end of the month. The etherscan transaction is here. We have tested increasing the loan and decreasing it. So far everything works as expected.
While New Silver was the first step, the community is quite bullish on RWA. We will target a batch (3?) of Centrifuge-related RWA onboarding end of May or in June. Risk assessments will be provided shortly and we will onboard what the community wants.
On the Trust structure, 6S is providing some documents. We are also working with REINNO and UPRETS on another Trust-like path (@christiancdpetersen). We expect progress to be made shortly. This will allow us to onboard Trust-related RWA using MIP21.
While we work on a forecast incorporating the workforce expenses, lack of clarity on the MKR compensation makes it difficult at this stage.
You can now have access to a Financial statement spreadsheet to follow financials month per month.
You can also find the usual monthly financial presentation of MakerDAO
All finance stuff are now aggregated in the finance website
We have started the onboarding of Arnold&Porter, a law firm that will advise us on RWA. The first focus will be an audit of the legal structures of New Silver.
Work has started on a follow-up of Crypto-banking 101, dedicated to liquidity issues and solvency with relation to the DSR.
Besides that, I found more and more evidence that DeFi needs a clearinghouse system for stablecoin. The Suffolk System is one and the Scottish free banking era provide another one. Curve and the USDC PSM are initials steps towards this system.
While not the focus of this core unit, we still spend some time using our work to promote MakerDAO, mainly on CryptoTwitter.
New Silver onboarding also provided a nice article (actually it was not related at the beginning) on Coindesk and an interview on CoindeskTV. Centrifuge also cited us in an article in The Defiant and on their blog. We also were on a panel in a Centrifuge call.
Edi: And the April financials did produce a Yahoo Finance news.
No progress made this month
- Financial statement spreadsheet
- Core Unit Focus: RWF
- Framework for valuing MKR
- Finance website
- MakerDAO Finance presentation for April 2021.
- Coindesk article
- CoindeskTV interview
@SebVentures - Facilitator
@williamr - Full-time contributor RWA
@Philinje - Part-time contributor RWA
@jameskmccall - Expert for farmlands
@christiancdpetersen - Expert for energy-related project finance and legal
@Aes - Financial analysis
You can find the ledger of the RWF Core Unit multisig here. 5,840 DAI were spent in April but most April compensations will be paid in the following days.