cryptobanking

MakerDAO is a very strange thing, a credit protocol, that is also trying to act like a lending protocol. I feel like one can do one or the other, but not both well in  eurodollar system. Its massively complex, yet still not even competing with wrapped eurodollars.

MakerDAO is a very strange thing, a credit protocol, that is also trying to act like a lending protocol. I feel like one can do one or the other, but not both well in  eurodollar system. Its massively complex, yet still not even competing with wrapped eurodollars.

https://x.com/ImperiumPaper/status/1803405670173007962?t=h7sUEqSeAzdeqK0sWCwlwA&s=19

What's the difference? Stablecoins and lending are the same thing. It's just a question of how strong your liquidity guarantees are.

Co-founder Phoenix Labs - contributing to Spark. Previously Protocol Engineering @ MakerDAO.

DAI started as being backed entirely by ETH which by your definition is a lending protocol. More recently backed by USDC and cash-like instruments. This happened in 2020 so what is the new development?

I would say credit protocols and lending protocols differ because credit has to maintain par, so it has stricter requirements for collateral to meet those liquidity guarantees. It's very hard to grow a stablecoin, but totally fine to grow lending.

My issue is MakerDAO fails at its base credit requirement as wrapped dollars that easily meet par requirements clearly have dominated.

Bad money drives out good money.