At the end of November, we saw MIP27 (The Debt Ceiling Instant Access Module) pass successfully through the monthly governance cycle. Since then it has been implemented and activated for the ETH-B vault-type, and has worked as expected as part of the Maker Protocol.
This signal request seeks to gain a mandate for rolling out the DC-IAM to new and existing collateral types where the mandated actors feel that it makes sense to do so. Smart Contracts feel that the benefits outweigh the risks, and this opinion is shared by Risk and the other mandated actors. While the previously mentioned griefing exploit is possible, we feel that it is low liklihood, low severity, and easily mitigated should it occur.
Details on the benefits of the DC-IAM can be found in MIP27, but briefly, it allows:
- Automatic management of Debt Ceilings such that governance can spend less time manually adjusting ceilings to keep the available debt low.
- Protection outside of the GSM-Delay in the event of a severe market downturn.
@Risk wishes to make it clear that more widely using the DC-IAM does not mean that we should just ‘yolo’ all the debt ceilings up by very large amounts given the new functionality.
Risk still needs to be managed actively, and in general increases as the amount of collateral locked in the Maker Protocol increases. This may lead to @Risk proposing higher Stability Fee values for vault-types that balloon in size.
Should this signal request be successful, an on-chain poll will be had to confirm that MKR Token Holders support the wider roll-out. From that point, risk evaluations will also include risk parameters for the
gap parameters within the DC-IAM.
Implementations for the existing collateral types will be added over the next few months, according to the Risk team’s availability, with on-chain polls to confirm the new risk parameters on a per-collateral basis. An initial set of parameters was provided here, but these may change before implementation.
The MakerDAO Mandated Actors
This poll will be open for at least 5 days, until Friday 15th January. It may be extended until Thursday 21st January if I don’t feel there has been enough participation or if the outcome is contentious after 5 days.