[Signal Request] Should Urgent Action be Taken to modify the proposed TUSD Risk Parameters?

Looking at DEX liquidity I estimate that around 150m DAI would need to be minted to arb versus USDC, USDT and TUSD to push the price down to $1.01 (assuming 101% LR vote on Friday is realistic and this is already our target in regards to DC increase). There’s additional demand on CEX and other pairs, so the final figure may be potentially around $250m DAI?

The 133m DAI that is currently in SAFE/DAI pool on balancer will be probably released back when farming stops end of this week. But I think we just learnt we always want to have 100m-200m buffer available to defend against these farms that can pop up out of nowhere.

What I also think is that we shouldn’t be really constraining ourselves or being fooled that doing a smaller rather than larger increase of DC for stablecoins makes Maker any more safer at this point. Also, if speculators and arbitrageurs believe that 101% LR on Friday is realistic, they will already start shorting DAI this week until DC is reached.

So we can either increase DC already now by 300m to accommodate for Friday’s potential 101% LR outcome if we want to pursue that strategy. Or make a “smaller” increase (100m?) so that we make sure DAI price doesn’t go up from here and then do the real one on Friday, when we’ll have more information on the potential 101% LR. The other issue is we don’t know how much more DAI goes into SAFE farming.

And then we also need to decide, whether we want more exposure towards PAX and TUSD by having same parameters and limiting USDC DC to some number so we force people to mint on other stablecoins. I think this would be great but not sure how feasible it is, assuming that current DAI from SAFE will be returned, USDC DC will be released and people will prefer it versus PAX and TUSD.


Hey folks, Rafael CEO of TrustToken here. Thank you for considering TUSD, I do think we can help!

If this vote passes, we can both leverage our corporate capital as well as activate the TUSD community to borrow DAI and assist the DAI peg.

I know risk :skull_and_crossbones: is on everyone’s mind when it comes to fiat-backed stablecoins. While we don’t have big name exchanges behind us like some other stablecoins, here at TUSD we’ve made tangible investments in trust and transparency exceeding other fiat-backed stablecoins.

  • Transparency: TUSD is the only fiat-backed stablecoin to ever have 24/7 real-time 3rd-party attestations. These come from top US accounting firm Armanino.

    • To take transparency to an even higher level, we’re now working with Chainlink Oracles to put this collateralization data on-chain for use by protocols such as Maker.
  • Trust: as mentioned above, TUSD has significant DeFi adoption and has the highest DeFi Score of any stablecoin listed on AAVE, higher than both USDC and USDT (PAX is not listed)

  • Access: TUSD is widely available through both 1st party and 3rd party fiat-to-crypto on-ramps, creating a new entry point for both individual and institutional Maker users. You can mint and redeem it right here.

  • Diverse collateral types from just one issuer: in addition to TUSD, we bring to the table 4 other trustworthy, real-time attested currencies: TrueAUD, TrueCAD, TrueGBP, and TrueHKD. This allows the maker system to diversify across multiple currencies while only taking on the risk of a single issuer. TrustToken is the only issuer that can offer this.

If folks still have concerns about TUSD as a collateral type, please let me and my team know so we can work with you to address them.


Just as a FYI regarding all stablecoins.

Total outstanding in order of float
USDT - 14800M
USDC - 2060M
TUSD - 500M
BUSD - 378M
PAX - 283M.
GUSD - 15M

Right now we are rapidly approaching 200M or 10% of all USDC.

I think if we are going to consider DC limits we need to consider limiting to some % of total outstanding on all of these so-as not to distrupt their markets.

I think 50% of any market is about as high as we should tread and we might want to limit some of these to no more than 25%.

Please list others I missed.


God damn, if Tether wasn’t such a fractional reserve it would be such a great asset. With TrueToken brass being on board, I really hope we can get them up on the supply list (barring any SC/Risk issues).


Not sure if I should put a sarcasm tag on this.

USDT would be one great way to devalue DAI collateral backing and perhaps restore the PEG. /s> :wink:


As you can see in another post I was looking at outstanding on the stablecoins to get a feeling for how much cap they can add and hence DAI liqudity. TUSD total outstanding I have at 500M.

So this begs a question of your TrueToken team and the TUSD component (thank you in advance for answering if you do btw).

What percent of TUSD cap would TrueToken be comfortable with being on Maker?

As much as we want?


Regulated stablecoins aren’t capped. As long as they can keep the peg (and be efficient to supply/withdraw their coins) I don’t see the problem.

If we can help some regulated stablecoins to gain exposure/market share, all the best.


They will be “capped” by the risk officers of banks… not by their issuer. There is only so much cash you can put in a bank before they will cut you off.

Further, stablecoins (less DAI) have no real ability to deal with negative interest rates. The entire model buckles.


The main goal of this signal request was whether we wanted to modify the RIsk Parameters to be more in line with USDC-A and PAX-A.

My opinion regarding the CR was that the on-chain governance poll holds more weight than a signal request. Better to use that for our signal.

I think voting on RP would be a bit of a distraction. Mainly semantics why it should be different than USDC-A and PAX-A. Could always start a signal request to change the RP of TUSD-A and go through the normal weekly cycle.

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As much as you want. Because TUSD is backed one-for-one with USD, large mints and redemptions and having a lot in one place doesn’t present a risk to stability. Because of how it works, someone could bring us $500mm USD today to mint 500mm TUSD and then redeem it the next day, and that wouldn’t be a problem.

While there might be a limit here, it’s much higher than we need to worry about ATM (probably in the tens of billions). We work with multiple banking partners and our compliance team is in close contact with theirs. In the US- Prime Trust, Alliance Trust, and Silvergate, and in HK- Legacy Trust (helps our customers in the region mint and redeem more quickly).

We generally assign users to banking partners based on location and whether they are institutional clients or individuals. But if we were hitting any limits with the banking partner on volume or $ deposited, we could always adjust how we are performing this assignment. This hasn’t been an issue as we’ve grown to $500mm but if it does become an issue we’re ready to address it.


Agreed that we still have a ways to go… DAI however could be 10s of trillions if scaled correctly. It can go where no other can. It can have all other collateral behind it.

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Right, there’s been some confusion here. On both my part and the part of the community.

As it turns out, Trusttoken haven’t actually deployed the upgraded TUSD contract yet. This means this is essentially a no-go for Friday. Smart Contracts are not comfortable having less than one day for testing.

It also just seems like a really bad idea to even set the ceiling to 10M on a contract that has only been live for 48 hours.

On the bright side, there is like ~480M TUSD floating around which is a hell of a bounty for someone to break it. If it’s not broken in a few weeks, it’s probably pretty safe. I’d propose that we revisit TUSD then.

Edit: Probably spoke too strongly here. See @cmooney’s and other smart contracts team responses below.


Interesting. Yes, I was also unaware that the contracts haven’t been upgraded yet.

One thing to note, the smart contract team reviewed the upcoming TUSD implementation 2 weeks ago.

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I’m going to add a counter-point we should consider. Since we want to be more aggressive about collateral on-boarding. How risky is this?

What does an implementation upgrade in the future look like? If you think about it, it will look just like this. They give us early access to the contracts, smart contracts domain team reviews it, MakerDAO approves the new interface for the join adapter, then they make the new implementation live.

This is the process for the least amount of disruption to our TUSD users and liquidators. Notice that this process looks exactly like the situation today. We reviewed the implementation ahead of time, MakerDAO approved the implementation addition, and it will just instantly go live once that spell executes rather than when they upgrade.

What’s more. We never added such an implementation check for USDC, as we had not thought of it yet. Furthermore, we were unable to add the check for PAXUSD as that variable was private scoped. While I support the implementation check, I wouldn’t be surprised if the TUSD team, who have been extremely accommodating to our requests, start to feel as though they are being arbitrarily and unfairly treated.

Let’s say they decide to upgrade six months from now and have a 100 million DC, after they jump through all our hoops, we still have the risk that an upgrade is extremely bad. The implementation check solves a particular set of risks for us, but we are no worse off than if PAXUSD or USDC do the same thing.


I personally voted for a DC of $10M because I believe it is a happy medium between the original plan (whitelist the current implementation, keep the DC at $2M) and the high end of the proposal: $50M. @cmooney is right that we did review this contract a few weeks ago, and the TUSD team did a great job of fulfilling our requests to simplify and streamline the contracts to reduce attack surfaces.

Since this new implementation is brand new, I think it would be wise to start with at most a $10M debt ceiling. As time goes by and the contracts prove to be stable and reliable both in general and with regards to MCD, we can start raising the DC more aggressively.


Would this mean starting this Friday?

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Yes it would.


We added the implementation check to prevent any surprises if the underlying contract changes. Frequent changes to proxied smart contracts somewhat violate the immutability standards of Ethereum, and the Maker Protocol can be vulnerable to an attack via our adapters if a token’s underlying contract changes. In this case, the check did it’s job and allowed us to evaluate what happened, and was a technical success.

That said, since that time the team has reviewed the new implementation and is satisfied that the new TUSD implementation is not a risk to the system, which was the goal of the check. There is no technical reason to delay re-enabling TUSD at this time.


Given the Smart Contract’s team’s input, does anyone still want 50M, and if so what’s the justification?

As it is, if 50M wins this signal, but the Smart Contracts team think 10M is the way to go, that leaves me to try to figure out a compromise or override either the community or the Smart Contracts team.

I’m also not sure how valid the 50M vote is so far given that presumably most people assumed that the contracts were already live.

Being in the middle sucks :frowning:


Should go to a governance poll with those options imo

But this of course means the community can’t take as “urgent” action as it wants.

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