[Signal Request] Should Maker Prioritize Onboarding A Compound D3M?

Overview

MakerDAO has recently tested and implemented the DAI Direct Deposit Module (D3M) as outlined in MIP50. This has allowed for Maker to directly inject DAI liquidity onto the Aave market, and has been successful in generating both DAI yield and stkAAVE for the Maker Protocol. The initial debt ceiling of 10m DAI was increased to 40m on November 15, and again to 100m on November 29. To date, Aave has been the only implementation of the D3M.

Signal Request

GFX Labs, in consultation with the @Growth-Core-Unit and prominent Compound community members, is signaling to prioritize onboarding a D3M for the Compound DAI market.

Pros

  • More revenue
  • Diversified counterparty risk
  • Demonstrates the MakerDAO does not favor Aave

Cons

  • More risk of targeting interest rates having adverse effects on the peg
  • Additional smart contract risk from adding another counterparty platform

Effect

In the event this signal is successful, Maker will prioritize the implementation of a Compound D3M at parameters recommended by the core units involved in that process.

Should Maker Prioritize Onboarding A Compound D3M?
  • Yes
  • No
  • Abstain

0 voters

This Signal Request will close on 2021-12-17.

4 Likes

Fixed polling options and added a date for the end-of-poll such that this complies with the signal guidelines.

1 Like

for a separate thread altogether but maybe this can be worked into risk modeling of these modules?

I would love to point out that Compound is developing a more or less direct competitor to MCD in form of Compound CASH. This may be the reason for Maker Governance to:

  • favor AAVE
  • not prioritize this module
6 Likes

You raise good points however I still think there is value in developing the compound D3M as it will give Maker Governance more options and it adds more support for DAI.

Governance can still choose to favor AAVE by offering a lower bar on the AAVE D3M module.

We are going to be stuck in old way if we view Compound as a competitor and miss our chance to grow further. Literally even direct competitors (between different Stablecoins or mainnets) are collaborating to find synergy in the market these days. I support expanding to Compound ecosystem

13 Likes

110% agree with this sentiment. MakerDAO needs to actively support the greater DeFi ecosystem so we can keep up and be a champion in the growth of the space!

3 Likes

I think we can see what this looks like if/when it comes out, and control for not assisting direct competitors through debt ceilings/rates. If more users on Compound use DAI as the primary borrow currency it may actually give us more leverage in the situation they launch CASH or even to prevent it being launched altogether.

5 Likes

This Signal Request has now ended. As the community has voted in favour, it will move to an on-chain vote when the Governance Cycle restarts on Monday, January 10th.

3 Likes

Quite excited to see the community supporting such expansions.

1 Like

Fyi, Risk Core Unit is in final stages of Compound D3M Risk Assessment. I personally think implementation with Compound is useful for two main reasons: diversification of D3M counterparty risks and the fact that Compound DAI borrow rates have been normally about 1% higher than those at Aave (incl. incentives), which makes competitive risks smaller.

5 Likes