Maker DAO – the leading collateralized stable-coin project announced on July 20 that it has successfully completed the transition to a decentralized autonomous organization (DAO) structure and the current Maker DAO foundation is all set to dissolve in the coming months, former CEO Rune Christensen said in a post titled “Maker DAO Has Come Full Circle”.
The blog post declared that the Maker DAO protocol has now gone fully autonomous through Maker Improvement Proposals (MIPs) and Core Units Framework, self-sufficient and in the hands of the global community. It also says that the foundation has bootstrapped the project and is confident that the core governance processes are now enough to govern the protocol.
Introduced in 2015, the DAI – the main product of the Maker DAO protocol has grown to be the most successful and used decentralized stable-coin. It serves as a hedge against the volatility of the crypto-assets. It’s an essential part of the DeFi world. Currently, around $5.2B+ worth of stablecoins is in circulation. Another $8B+ assets are locked in the protocol. However, the protocol faced criticism over its unhealthy reliance on USDC to maintain a peg closer to $1. Corrective actions came into action for DAI to get off-peg during times of volatility.
About Maker DAO
Maker DAO provides the core DeFi functionality of stablecoin, it does so by issuing the DAI token (pegged to 1 USD) backed by a basket of crypto-assets (ETH, LINK, etc.) deposited into Maker vaults. The DAI token is always overcollateralized. This means that the protocol holds assets worth more than the DAI tokens issued. It’s necessary to ensure stability and protect against volatility. It also allows users to access credit in the form of DAI stablecoin without selling their assets. Users can later recover by paying back debt and interest to the protocol.