Co-founder of MakerDAO advises DAI-USD depegging to reduce attack surface

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Last Updated on August 29, 2022 by Bitfinsider

MakerDAO co-founder Rune Christensen reached out to the community in light of recent conversations of decoupling its native token from USD Coin (USDC) amid the sanctioning of Tornado Cash to explain why free-floating Dai (DAI) may be the only option for the decentralized autonomous organization (DAO).

Christensen acknowledged underestimating the hazards associated with Risk-Weighted Assets (RWA) in his blog post titled “The Path of Compliance and the Path of Decentralization: Why Maker has no choice but to Prepare to Free Float Dai”. He said: “Physical crackdown against crypto can occur with no advance notice and with no possibility of recovery even for legitimate, innocent users. This violates two core assumption that we used to understand RWA risk, making the authoritarian threat a lot more serious.”

Christensen stated that “we must choose the path of decentralization, as was always the intent and the purpose of Dai,” while admitting the protocol’s incapacity to abide by regulators.

The only option left, he continues, is to limit the attack surface by reducing RWA exposure to a maximum fixed proportion of the entire collateral, which necessitates free floating away from USD. He believes that decentralizing Maker will lessen the impact of crackdowns on the overall protocol.

It is significant to note that, according to statistics from daistats, over 50% of DAI is currently collateralized by USDC.

Joey Santoro, the creator of the decentralized financial platform Fei Protocol, suggested suspending Tribe DAO’s participation after compensating Fuze victims.

Rari Fuze hacker had previously been given a $10 million reward for revealing over the $80 million worth of assets, but Fei Protocol never heard back from the attacker.


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Hardware wallets are safe and secure devices that can be used offline. They keep your cryptocurrency offline, making it impossible for you to be hacked. To find out more on the leading hardware wallets, you may view our reviews here: Ledger & Trezor
Disclaimer: The views and opinions expressed by the author, or any people mentioned in this article, are for informational purposes only, and they do not constitute financial, investment, legal, tax or other advice. Investing in or trading cryptocurrency or stocks comes with a risk of financial loss.

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