As both MIP13c3-SP4 Declaration of Intent & Commercial Points - Maker Governance Intends to Utilize an Off-Chain Asset Backed Lender to onboard Real World Assets as Collateral for a DAI loan and MIP21: Real World Assets - Off-Chain Asset Backed Lender are now in the governance cycle for October 2020, I would like to get a formal signal from the community whether they would like to approve and implement a Maker Representative (in general) and then futher approve a specific list of candidate representatives that have stepped forward and expressed interest in serving in this capacity.
With the objective of bringing on Real-World Assets as collateral to MakerDAO (to which the community has signaled a desire to accelerate via [Signal Request] Should Real World Asset collateral onboarding be prioritised in the short term?, I submitted both a Declaration of Intent to Utilize an Off-Chain Asset Backed Lender to onboard Real World Assets as Collateral for a DAI loan and MIP21: Real World Assets - Off-Chain Asset Backed Lender, as its technical counterpart. Embodied within the above, includes the ability for a off-chain lender to provide loans for a specific capital “sink” while having MakerDAO provide that capital in a secured manner. A specific “role” is included with those proposals, the Maker Representative.
Another recent forum post Calling community members to be a Maker Representative asked for volunteers for this role which had a number of folks raise their hand.
Fundamentally, as Real World Assets are brought on as collateral, the DAO as an organization is basically operating in the “dark” as information the DAO receives can only be information released to the public. All off-chain lenders will come in contact with “confidential” information. The fundamental on-going role of a Maker Representative is to be a proxy for the DAO as he / she can execute a non-disclosure agreement with the off-chain lender and can provide an “early warning system” should an off-chain lender not be in compliance with the agreements. I wrote another forum post about translucent finance covering this topic. In addition, the Maker Representative will have administrative engagement with the off-chain lender to help setup the initial legal construct (e.g. engagement with a trustee).
What a Maker Representative needs to do:
Execute a non-disclosure agreement with an off-chain lender
Review lender’s legal setup and construct
Review lender’s transactions on a spot and quarterly basis
- Independent Financial Statements and confirm they were delivered timely
- No operations outside of approved scope
- No loans above portfolio threshold issued
- Equity requirements for all loans in compliance
- All loans issued are either performing or under construction
- Report back to the community the abstracted summary of the above:
- Fully Compliant
- Compliant with minor comments.
- Material Breach - Not in compliance.
Note: The Community can easily replace Maker Representatives !
The community can use this signal request to express support or opposition to the concept of a Maker Representatives (in general) add then express support or opposition to add the initial group of individuals below as the first Maker Representatives conditioned upon MIP21 and its subproposal MIP13c3-SP4 Declaration of Intent & Commercial Points - Maker Governance Intends to Utilize an Off-Chain Asset Backed Lender to onboard Real World Assets as Collateral for a DAI loan passing an executive vote.
Note: A Maker Representative may also form a legal entity to carry-out the same duties.
Do we create an oversight role for Real World Assets collateral based lending for the benefit of MakerDAO?
Polling will last until 16 October 2020 12:00 UTC. Please choose all options you agree with. I look forward to your discussion and participation!