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MakerDAO is trying to strike a balance between business efficiency and the egalitarian principles of decentralized autonomous organizations. For the uninitiated, MakerDAO is the oldest and one of the most prestigious lending protocols in DeFi.
The DAO community can surely get inspired by MakerDAO. However, looking at this week’s actions, it’s not going to be a simple and stress-free process.
A member of the Protocol Engineering Core Unit, Sam MacPherson, tweeted that the status quo is not working. MacPherson is the person who proposed to form a “Growth Task Force” at MakerDAO.
Currently, the DAO is not established to take high-level decisions that have the potential to cause decision paralysis or less informed parties taking sub-optimal calls.
The membership of MakerDAO contemplated three proposals on June 27 that could lead to the reconstruction of the management approach in exceptional ways. The proposal could have led to the formation of a quasi-board of directors. However, it turned out that the DAO members rejected all three propositions through voting that suppressed record turnout.
The sheer fact that they were brought to the floor for a vote marks a crucial moment in the evolution of DAOs. GFX Labs, which develops authoring governance proposals across DeFi along with protocols, stated the proposal to establish a “core unit” to supervise the orientation of collateral assets and manage the growth of the organization was quite innovative.
GFX Labs, in a tweet, said that the just-finished governance vote of MakerDAO could be the most controversial of all DAOs.
All the governance changes are happening amidst a period of soul searching in the entire DeFi community during the worst bull run that it has experienced since 2018. Terra collapsed in May, shaky major players and stress in the DeFi lending space factored in this. A court directed Three Arrows Capital to plunge into liquidation on June 29.
MakerDAO has held itself quite firmly amid the volatility. The flagship currency of Maker and a one-time target of Do Kwon, Terra’s founder, has steadily stuck to its dollar peg meanwhile other stablecoin perished.
Maker has closed deals that allow the real-world assets to be collateralized, a bold push into the nexus between traditional finance and DeFi. MKR, its token, has decreased 36% in the past 30 days. However, it’s still better than the 47% decline in Ether.
Since July 2021, MakerDAO has been completely decentralized.
Nancy J. Allen is a crypto enthusiast, with a major in macroeconomics and minor in business statistics. She believes that cryptocurrencies inspire people to be their own banks, and step aside from traditional monetary exchange systems. She is also intrigued by blockchain technology and its functioning. She frequently researches, and posts content on the top altcoins, their theoretical working principles and technical price predictions.
