On December 23rd, we had an AMA session with MakerDAO, a decentralized lending facility built on the Ethereum blockchain, in our Telegram Chat. Rune Christensen, CEO and Founder of MakerDAO, was present on the discussion with our community.
Here are the essential points of the AMA session:
Please welcome Rune (R) and the questions from our Telegram chat members (Q).
MakerDAO in its protocol and features
Q: What is MakerDAO?
R: MakerDAO is a protocol and community that maintains the decentralized DAI Stablecoin, which is pegged to the USD and is used by the DeFi community and unbanked people around the world. We are one of the oldest projects in the space, having started out 5 years ago and had a live product for more than 2 years
Q: What makes Maker (MKR) different from Chainlink and other alternatives?
R: Maker and chainlink are very different as Maker provides a stablecoin and Chainlink is an oracle service. What makes the DAI Stablecoin by Maker unique is that it is decentralized unlike for instance Tether.
Q: What are the benefits of the DAI Savings Rate (DSR) and how does it make an impact moving forward?
A: The DSR is different from DeFi lending because it comes directly from the Maker protocol, so you are not taking any additional risk like you do when you lend out on e.g. compound. This also means the return is lower since the risk is lower.
Q: Can the oracle solution deployed for DAI be also applied to other projects relying on smart contracts?
R: The governance attack problem is already fixed through a mechanism called the governance security module.
Q: How did MakerDAO manage to survive as many projects disappeared in hard market conditions? What is your survival strategy?
R: Unlike most projects in the crypto space, MakerDAO never had an ICO or spent a lot of energy on marketing and hype. Instead, we just focused on building a solid product and while it is a slow strategy, it ended up paying off since we could survive as the market hype faltered.
Q: What benefit can you offer for the non-expert users that prefer to use USDT or another fiat-backed stablecoin?
R: I think the fact that DAI cannot be frozen or seized from your account is a big advantage. Additionally, you can earn a 4% per year without any additional risk just from holding DAI with DAI Savings Rate turned on.
Q: How robust is your new Oasis application? Why should we use it? Does it offer all MakerDAO features as an all-in-one application?
R: Oasis is a very old Ethereum. In fact, it was the first-ever DEX on Ethereum launched back in early 2016. It offers all Maker Protocol functionality similar to other frontends such as InstaDApp.
Q: What is the speed of DAI tokens transfer? Can DAI tokens be integrated into other blockchain platforms or is it not necessary and why?
R: DAI is mainly based on the Ethereum Blockchain, so it follows Ethereum block times. However, we are very focused on cross-chain compatibility and already have the xDAI sidechain that shows how cross-chain technology allows for huge scalability improvements.
Q: How is the process of DAI Savings Rate (DSR) integration?
R: It is a simple smart contract that can be added either directly or through the Dai.js library that the maker foundation maintains. A few days ago, OKEx, one of the world’s largest exchanges, became the first centralized exchange to integrate DSR for their millions of users.
MakerDAO in its future plans
Q: Decentralized Finance (DeFi) has become an extremely popular term in 2019. What do you see as the biggest benefits of DeFi and where do you see it growing to in 2020?
R: I think DeFi is only in its very early stages. Right now it is still experimental and lacks impact on the real world. Once we get a connection to real-world assets on the Blockchain DeFi will start actually improve the lives of ordinary people and businesses. Eventually, I think it will overtake and merge with the financial system
Q: Any approximate deadline for governance community adoption?
R: We haven’t yet published our plan, but we will get started with it together with the community at the beginning of the new year.
Q: Approximately how many cryptocurrencies are planned to be added for collateral in 2020?
R: I am personally hoping that we can onboard 30-40 new collateral types over the year.
Q: Which avenue the MakerDAO team will take regarding the 20 million contract overtake threat?
R: A couple of DeFi projects already use the Maker oracles such as dYdX. In the future, we will roll out a new version of the oracles that will make it even easier and safer to use.
Q: What do you think is DAI stablecoin ready to do with financial transactions in big sectors and organizations like banking, hospitals, etc. just like USDT does?
R: At its current scale, DAI is not yet ready for real-world b2b transactions but once real-world assets are added as collateral, it will be possible for DAI to scale enough to meet any use case.
Q: Recently, MakerDAO announced a strategic partnership to bring DeFi to China. Twitter CEO said Africa is the future for everything blockchain, so what is DAI going to do to also spread and bring DeFi to Africa?
R: We are doing various partnerships focused on Africa but are still focusing on other regions (South America and Asia) before we fully focus on DeFi adoption in Africa. DAI is, for instance, integrated with Coindirect, which provides access to buying and selling DAI in more than 20 countries. We also support DeFi meetups in Ghana that are very popular.
We were glad to host MakerDAO on our Telegram. Thanks to the team and all the members of the session!