[Signal Request] Repeal "Parameter Changes Proposal - MakerDAO Open Market Committee - June 28, 2021"

I am supporting the repeal because I specifically asked a couple questions, the most important in my view received no response, which was “Please show, based on current usage and not expectations of gained market share, profit or loss if those rates are implemented. Apologies if I missed it somewhere. If losing, then what additional market share/volume would need to be obtained to break even.” The proposal should not have proceeded until this question was answered in some form.


Central banks major duty is not a profit in a first way. But market share). But I do have on question to you. As a legal adviser what do you think of Wyoming Law. Seems to me 75000 votes is not enough for the quorum.

I am voting Yes. My primary concern is related to the downstream bundling of the Executive which may contain contentious items. We really want to avoid scenarios where folks launch campaigns against an executive.

With basically zero time to have any debate, we are rapidly pushing toward putting all of the power in the hands of a few. I don’t have an issue with recommendations in the hands of a. few, but debate is essential with a minimal process to allow modifications.

I do not think we need a wee, even 24 hours would be better than zero.


You are right for shure. Right know there is no place for democracy. We are on the same groundfield with Circle.

This would be a good addition to the report and could be added easily to the spreadsheet (well it doesn’t have RWA revenues but that’s not much).

We need 74% more minting to be break-event, which is unlikely.

Revenues before/after:

1 Like

I voted “yes” as ultimately I believe there should have been a more formal discussion/debate as outlined in MIP46c2.

That said, I do want to recognize the circumstances laid out by @LongForWisdom in that there was already some debate/precedence from a prior PPG, and that the judgement call to expedite was not entirely unwarranted.


Same vi

And the expectations are? 1.5 mil extra Eth would be locked in colaterall? I hope there are some market strategy to bring this extra supply of eth from the market?

Thanks. What is our current annual expense budget?

Expenses estimated - $32,000,000
according to Makerburn app

There were a poll that last 3 days or more. While it seems little the next rate changes is in 20 days. That is leave 15 days at max before the next PPG, how do you want to evaluate the impact on the previous change if it did not happen.

May be the debate should happen before the PPG. The same way we had the summer party debat.

I am careful to not opine without knowing all of the facts. However, maybe an option to consider would be to have the proposal released on a Friday so the community would have time to digest over the weekend and raise any issues and then go into a poll on Monday. From my lens, that would allow a decent hybrid of both speed and informational flow.

1 Like

Yep, I actually already proposed this to the group, and they agreed.


Would it changed the decision? It wouldn’t because once you take a decision you don’t change it 2 days after and 2 days after again.

I understand your point of view. And you can see actually the vote against this rate changes being on the case you raise. If we remove the PSM today the dai would be at 10 dollars right now. I would ask you what the fact which lead to have a PSM full? Why people want to have an easy cash access? Why do they want no liability on this cash?

The only way to sort this out and avoid all political problems - as it is - is to make the rules clear by coding them and shipping the code. That is how we do, that is how we are removing the need to know all of the facts.

I think it could be even easier than this. If the rates group is following a formula, they could just publish the formula and this will be the assumed changes on a weekly basis. If you think something is wrong, you’ll be able to see the outcome from a while away and petition to change the formula/override it.

I’d advise against anything too “on-chain” unless it’s gone through some serious manipulation-testing.

1 Like

Easier than not having to worry about checking them? :slight_smile: tho I understand what you meant.

Most of the issue with not having coded rule is that you end up with non deterministic rules, like parlements.

If the rules are deterministic they can be built if not you will end up with the same problem “the interpretation of the rules”. And quickly you will have the unwritten arrangements / rules.

IMO the number one reason why we should lower fees is to guarantee our survival in a highly competitive market. I understand the concerns about short term cash flow, but I can’t overemphasize how important it is that we focus on growth at the current nascent state of the market. Maker MUST be the cheapest place to borrow at large scale against ETH, always, and guaranteed at prices our users will know to be highly competitive and worth it. This way, most automated systems will target Maker for their integrations, and will become highly sticky demand. The risk of keeping fees high is that maker might lose out on these integrations and be left in the dust as other protocols take off, when things start to take off for real.

Only exception should be if we are hitting dangerous levels of exposure, which we definitely aren’t any time soon compared to the risk in USDC and the incredible liquidity and value prop of ETH (and don’t forget that we earn from the liquidation penalty!)


@Aes, who was on MKR compensation MIP those last weeks, will work on an annual expense budget. You can expect something like $20-25M (excl. MKR) I would say.

Thank you. With that information, doesn’t that give you all pause? At $25 MM expenses, the proposal wipes out over two-thirds of our profits on current basis and without providing evidence to show what market share or business will be gained by doing so. This is something that should have been stated and defended by the proponents. With that information I would have emphasized my suggestion on that forum post to first match or beat more liberal/risky collateralization requirements of competitors.


This is not far from what I proposed 2 months ago (DeFi Summer 2.0) and that was supported by a vast majority.

I also highlighted here, that some significant loan positions are already barely profitable and might unwind. So this profit is lost one way or the other. This was what convinced me that we don’t really have a choice.

Moreover, in the long run, I always stated that crypto-backed lending will not earn much more than 10-50bps over the risk-free rate (not much more than lending against stocks). Hence my focus on RWA and term lending. Institutions are coming to farm the alpha between crypto lending and LIBOR/SOFR.


Don’t disagree, need to focus on RWA, but the issue here is substantive process in adopting what must admittedly be one of most significant issues that has come up recently.

P.S. You have a broker who lends on stock at less than 7%? Send his/her email address to me. :wink: