Every semester Professor Joel Greenblatt of Columbia University would ask his students of the Value & Special Situation Investment course, “how do you beat Tiger Woods?” The answer was, you don’t play him at Golf. Instead of trying to figure out how to beat him and spend time banging your head against the wall, you play him in Chess.
When Maker Goes Up, I Get Those Wam Fuzzies
With the recent success of the ETH and MKR price, many of us are excited and feeling gooey with those warm fuzzies you get inside–you know what I’m talking about . But with all of this success, we tend to forget that our main objective is not that exciting feeling of clocking DAI, or profits, and it’s not necessarily the feeling of knowing you can pay the rent/mortgage for the next 24 months with no worries, or that you can finally take your dream trip to Madagascar. It goes beyond financial success. Our Mental Health is one that we must keep healthy–it’s important to take care of yourself and get the most from life. Remember, money is not everything.
If you, or anybody you know is experiencing anxiety/mental health issues, please reach out to someone and talk about your feelings, keep active, eat well, keep in touch, and ask for help. Because God knows, the Maker Community is going to need you
Why Should We Play Chess?
With the success of the DAO in 2020, we must not forget about our ultimate goal and remember that we are still in the early stages of developing a new product that has a lot of competition. Yes, we are the first movers in offering the World a decentralized stablecoin. But with that quick success comes a lot of development, vision, focus, and maintenance.
We All know that centralized tokens like USDC, TUSD, PAX and USDT sell their solution as a digitized version of the asset they represent–mainly the mighty U.S. Dollar–reckoning they have 1-to-1 fiat reserves to back the tokens they issue. Other protocols like our beloved DAI, or sUSD have a crypto asset backed design, and others are elastic supply tokens governed by algorithmic mechanics to maintain a $1 peg.
So, what is the difference when utilizing DAI, BUSD, USDC, USDT, FRAX, etc. for the consumer? Let’s see:
USDC: Certificates of Deposits
Algo Stablecoins: Algorithmic Mechanism
DAI: Currently 50% ETH, 31% USDC, 9% WBTC, and the other 10% of assets that have not gain traction.
I strongly believe we are ahead of the game versus all centralized and decentralized stablecoins, and consumers should choose and use DAI versus any other stanblecoin IMO. But when you look at which exchanges hold the most stablecoins–Alex Svanevik of Nansen recently wrote: “By far the largest exchange in stablecoin holdings is Binance , which holds >$1B in BUSD, >$500M in USDT, >$500M in USDC, plus other stablecoins.”
And if we look at top 5 exchanges with stablecoin balances, Uniswap who is number two (2) with $700M+ has $188M of DAI liquidity, trailing USDT w/$205M, and USDC w/$260M. The reality is that ALL three (3) stablecoins have a lot of growing-up to do.
So, how do we innovate and separate ourselves from the rest? Do we take the YFI approach and become another “hedge-fund in your pocket” protocol, or do we become FIRST Movers in diversifying our Collateral? How do we play chess Maker Community?
First Stablecoin Mover to Real World Assets
Speaking of staying “Grounded” to the actual ground, we are on a mission to be the first Stablecoin to include RWA. We have Centrifuge, Six S, and a few others waiting on the sidelines, keen to help DAI decentralize beyond tokens. It is my believe and opinion that we make a strong push to onboard as much RWA that fits our risk tolerance into the protocol in 2021. We must play chess versus others. Chess is a game of strategy and tactics. The opening, the middlegame, and the endgame.
What is your opening? If you don’t have an opening, will you bring ideas & resources to the community that will help the DAO have a middlegame? I hope that your endgame is not the profits you have accumulated in 2020 because We can change help the world, We can make a difference. Let’s play chess!