MakerDAO is set to introduce the multi-collateral Dai update in 10 days. The new version will allow for Basic Attention Token to be used as collateral in addition to Ethereum ahead of other tokens. The upgrade will also introduce interest on locked-up stablecoin.
The multi-collateral Dai update is more comprehensive than the name would suggest. Alongside a line up of new features it phases out the ‘old’ single asset Dai as Sai, requiring all users to migrate to the new token within a few months. The update will also introduce interest on deposits. “Collateralized debt positions,” or CDPs, were also renamed as “Vaults.”
Community votes to drive the processes
MakerDAO makes many of its critical governance decision via community vote. In addition to governance decisions, holders of the platform’s coin, Maker, benefit from dividends from the platform but also assume additional risk as insurers in cases of system failure.
An example of one of these decisions is today’s vote for lowering the ‘stability fee,’ equivalent to the interest rate on loaned-out stablecoin. Announced Thursday and locked in today, the proposal lowered the fee by half a percent down to five percent. The vote also increased the maximum Dai supply to $120 million.
The community will be required to vote for the specific assets to be used in multi-collateral Dai. The decision follows a vote from this summer that identified Ethereum, Augur, Basic Attention Token, and 0x as assets prioritized for inclusion.
The lead time to the decision was used to conduct additional research on each of these assets to proactively identify potential issues. One such complicating factor turned out to be Augur’s expected v2 update, which would phase out the existing REP token and potentially break Maker’s smart contracts.
Earning interest on Dai
The Dai savings rate will be the other core feature of the upgrade. It will allow Dai holders to lock up their tokens and earn ‘interest’ in Dai itself, potentially reducing their exposure to market volatility.
The exact interest percentage will be decided by the community in an upcoming vote. Cyrus Younessi, risk management lead at the Maker Foundation, suggested that “… a DSR of 2% is likely to be competitive with the broader DeFi ecosystem, which currently offers a ~6% (and dropping) savings rate on Sai.”
The post appeared first on CryptoBriefing