The PSM has given USDC increased exposure in defi by being able to mint Dai 1:1.
It’s not surprising that other stablecoins like Pax, BUSD and GUSD want this same exposure and would benefit from being added to the PSM. Stablecoins that are on-boarded get an incredible benefit of being direct minters of Dai. For this service, we should consider all the potential benefits the Maker protocol can receive in exchange for adding new stablecoin support, in addition to maintaining the peg.
For example, it’s critically important to consider what they add to the total distribution and usability of Dai. In the case of Paxos, the issuer of Pax, being able to have Dai enabled on their platforms api’s and infrastructure, which serves fintechs like Paypal and Revolut, it is clear that they can bring value to Dai by supporting it on their products which ultimately creates more demand for Dai and then more Pax minting of Dai. Looking at the full scope of benefits a stablecoin like Pax can bring, also offsets its current somewhat limited circulating supply.
For MakerDAO, including Dai in the Paxos API and infrastructure means directly on-off ramps from USD to DAI (through PAX) and a regulated channel for Dai minting. The difference between USDC and PAX as collateral in the PSM is that Paxos could offer this service for Dai if we can get an agreement with them. Binance and Gemini are similar, and we are in conversations with those teams to find out what they can offer to MakerDAO.
Further, there has been active discussions in the community about what collaterals are the most productive and which are costing more by maintaining oracles, performing risk assessments and other operational overhead. We should evaluate stablecoins that are considered for the PSM in the same way, with an emphasis on how they increase the demand for Dai generation and usability. The Growth team is actively discussing how some of the pending stablecoins can bring utility to Dai users by opening up new distribution channels and we’d like to have a few weeks to conclude these discussions before adding these stablecoins to the next on chain vote.
If yes wins, we will delay this poll until having a clear understanding of what Paxos (or the others) can offer to MakerDAO to add PAX(or other stablecoin) to the PSM.
If no wins, the normal cycle of the poll will continue.
We will keep everyone updated with any relevant information we get from Paxos, Binance, or Gemini.
Poll ends on Thursday, 1st of July.