Hey Sam, sorry about that. I'm not really sure what's going on with spaces today, but we're gonna We're gonna redirect everyone this new link give us like one or two minutes and we'll get started Yeah, sure no problem
All right cool. Hey, sorry about that Sam. We can get we get started if you're ready. Yeah, sure. Awesome. Well, welcome everyone. We got Sam McPherson in the house with MakerDial with Sam before we get started. You want to give us a quick back?
I think you and I had a really great conversation when we chatted a few weeks ago. Can you just click background of yourself, your career trajectory, the kind of work you've done in the space so the audience gets to know you a bit better, and then we can talk about MakerDow.
Yeah, sure. So I joined into crypto more as a hobby investor in the 2017 full cycle. I became interested particularly in maker.
I was just looking around at various investments. And about that was 2018. And a couple of years later I ended up starting to work at the protocol.
I was the first to be onboarded under the Dow as a smart contract engineer.
So yeah, I never worked for the Maker Foundation. So that's kind of an interesting tidbit. Yeah, so I've been working for MakerDow under the Protocol Engineering team as a smart contract engineer since August 2020.
Awesome, so you've been part of the team for a while. Can you give us a high level overview of your own words of what MakerDow is, how the MCD system works, and then we can jump into nuts and bolts of things.
Yeah, sure. So the maker protocol facilitates the minting of the die stablecoin, which is a synthetic asset that is meant to track the price of the US dollar. So it uses all kinds of different mechanisms to do this.
first being the ETH vaults. This was the, there was also a single collateral version that was launched in 2018. So in this mechanism, users can take ETH and let's say they have a
They can then mint up to the collateralization ratio limit of that ETH. So just for round numbers, let's say you need to maintain a 150% collateralization, then you can mint up to 100 dye for that
150 dollars worth of teeth. And then with that dye you can do all kinds of things. Usually people leverage with it. They go leverage long on teeth and so they'll take that dye that they mint and then buy more teeth and add it to their position. But there's all kinds of things you can do there.
So more recently there's been additions of what are called peg stability modules which are the first one being USDC. So that is another tool designed to keep the peg in line for die so that it's always or at least in most common cases is redeemed.
for one US dollar worth of collateral. The maker system has been around for a while and it's taken the conservative approach of making sure that there is always more collateral in the system than there is die-outstanding. This is to ensure that there can't be things
like bank runs and whatnot. Yeah, so this is basically a high level overview. Got it. Sam, I had a couple questions on that and this is a topic that my friends and I had debates on in the past but the whole ethos, the initial ethos of making
down was to have this decentralized stablecoin, which you've explained the collateralization component of with ETH. When you guys introduce USDC, doesn't that kind of take away from that whole decentralized ethos since USDC is a very centralized stablecoin?
So I'm going to make a couple of points on this. First, there is what we call a stablecoin trilama, and that you can only have scalability, decentralization, and I can't remember the third one.
Security. Yes. Okay. Thank you. So basically you have to choose which route you take. Die as a stablecoin. Wouldn't have been able to scale past a few hundred million if we didn't onboard USDC and other stablecoins.
Now that being said, this is viewed as a crutch and although a temporary crutch and although USDC is super valuable for maintaining the peg, it does trade off decentralization for centralization risk with particular counterparties as you said.
So, the other thing that we're trying to do is make sure that the market is in a way that the market is in a way that the market is in a way that the market is in a way that the market is in a way that the market is in a way that the market is in a way that the market is in a way that the market is in a way that the market is in a way that the market is in a way that the market is in#
So by having a wide, a large collateral portfolio, it still helps with the diversification and decentralization aspects. Just you keep, it's good to keep in mind that decentralization is an emergent property and it can come about from centralized components.
I'm going to steal that quote from you Sam. What other basket of goods is die collateralized by then? So it's obviously ethereum then you guys introduced us to usdc but you've said other stable coins as well so if you can give us a breakdown of that I really appreciate it.
Yeah, there is a number of collaterals. I think there's about like maybe on the order of 20 to 30 now, but I'll go over the big ones. So USDC is the largest collateral portfolio right now. During the bull market, it was ETH and RAP Bitcoin that were the dominant collateral types because what we were in a bull market.
So people were naturally levering up a lot. So that shifts depending on the market sentiment. Other stablecoins that we have are collateralized by Gemini USD as well as Paxos USD.
They each have about 500 million of the supply and USDC is 2 billion. And then more recently we are collateralized by what is called monetalis, which is a direct investment into a black rock money market fund ETF.
So that gives us more direct access to the underlying treasury yield, which is great for revenue. So you guys are diversifying, for example, into this block rock ETF. How does that work? Are you diversifying with the basket of goods that is being
collateralized or give us some insight into that process please. Yeah sure so you could think of it like this when we onboarded USDC there is arbitrage mechanisms that every time the peg goes above a dollar let's say dye is trading on the market at a dollar
Once we have this PEG stability module with USDC, there is an opportunity for an arbitrage to make a profit off of that because they can take $100 worth of USDC, they can mint $102 worth of
and then sell that back into the USDC on the market. This will bring the peg back down and this keeps it online. But the secondary effect of this is that it loads up our balance sheet with USDC.
Now, this is all finding good, but USDC is currently yielding 0% return to us, which is not great. But this USDC is protocol controlled value so we can, as
So for this money market fund, this is done with real world asset arranger. They will mint them, they will move it out through the
the USDC redeem it for the USDL in the underlying reserve and then take that cash and put it into the Black Rock ETF just like you would with like outside of crypto normally.
Yeah, so WB, yeah, the main large-scale crypto-innov glaterals are ETH and WBTC and now we also have liquid-staking derivatives such as LIDO-Stake ETH.
And how would that work? You would just stake your Lido, your, I think it's LE or whatever you're given in return of staking into Lido and then collateralize that and get died? Yeah, exactly. It's just like you would do with
with ETH, people primarily like to use it for leverage. So if you have some steak teeth that you're earning a yield on and you want to lever up on it, then you can open up a vault on Maker and then mince some dye and buy steak teeth.
So one of the things I'm curious about is what would happen hypothetically and this is what a question I had when you guys first became very prominent. What would happen if the price of Ethereum just plummeted? I mean this is kind of a black swan event and it's probably never going to happen.
But what if Ethereum just went to pretty much close to zero? Would that collapse the entire stablecoin? Or do you guys have enough diversification into other assets or even in this case the ETF where you guys would be able to remain pegged to the dollar?
Yeah, I mean, this is an interesting scenario because maker lits on Ethereum. So presumably something has gone terribly wrong on the Ethereum chain in that scenario. But just like purely from a market perspective, we would survive that just fine as
assuming there's not some terrible event affecting the chain itself. If it's just the market price of Ethereum, people would just close out their positions and that missing supply would be filled in with centralized stablecoins.
understood. So Sam, what are some of the common proposals that governance votes are usually casted upon? Is it simply adding new assets to that collateralized or over collateralized baskets of goods or is it adding new options for assets
to be collateralized, look for more insight into that structure please. >> Yeah, sure. So maybe I'll just run through some history on this because the thinking has evolved over time. Originally when MCD is multi collateral die, so when that was conceived,
The idea was that although real world assets were still on the long term goal, there was the view that we would collateralize die with ERC 20 small cap tokens. So this would be like the Uniswap token or like Link or various others. We onboarded a whole bunch
of those. And that was fine. It was a good experiment. The problem is that there's just not enough demand with these smaller CAP ERC20s to get up to the supply amounts of billions of dollars. So we've shifted or makers shifted
since then and adopted more of a large scale assets only. We're makers only interested in things that scale. So that is basically for crypto native that is only really eth, Bitcoin and liquid stake
derivatives of it. It's possible that like layer two tokens such as optimism's token or when arbitrage launch is one or polygonsmatic those maybe at that scale as well but we'll have to see they're not there yet. So for
the crypto native, those are really the only options at the scale of billions of dollars. And real world assets are the only other thing that works. I mean, if you really think about it, like most assets on Ethereum are either ETH or real world assets.
Sam, Sam, I don't see much of a downside and correct me if I'm wrong here. Is there much of a downside in adding a volatile token except that end of the day if someone wants to choose to collateralize something that's highly volatile and the price plummet so they get liquidated.
in the protocol keeps that liquidity or keeps that collateral, right? Yeah, I mean, it's an option maker can go down. It's just, it's not free to add collateral. There's maintenance and overhead. And so it was just viewed that it
wasn't worthwhile. As far as the maker token is concerned, I know that the main function is governance influence. Are there any other token utilities with respect to MakerDow that the token offers?
Utility? No, I think that's fair. Just governance is the main utility.
Has there ever been any proposals to add some sort of an earning structure to make the maker token? I know that I'm going to use this for example, Abercadaver.money, the spell token, let's users that stake it, earn a percentage of those protocol fees.
Yeah, so there is there I mean there's been no shortage of proposals to this tune over the past few years But nothing has come in yet. There is some plans within runes and game plans
to activate some yield on the maker token. But yeah, you'll have to go read this plan. I'm not super familiar with all the details of what this particular aspect is, but I believe there is a component where yield will be earned on delegated maker.
Is there a reason that the proposal or you said there's been no shortage of these sorts of proposals? Is there a reason that none of them have ever passed? Like what are your personal thoughts on adding some sort of a yield mechanism for the or rather a yield reward for the maker token?
Yeah, I mean, it has to be done very carefully. Like anything like you add this in and it's possible there may be no turning back and you it potentially it's not the right incentive structure and it leads to the destruction of the protocol so you have to
to be like with any of these types of incentive mechanisms, you have to be very, very careful with switching them on. And why particular proposals? I would say about half or more proposals don't pass in general. So there's just because it's a permissionless
submission. Yeah, just lots of different things have come through, but you know, not everything passes. Fair enough. Is the actual allocation of Maker tokens super centralized? Is it pretty centralized with this other governance kind of governance token allocations?
I wouldn't say I'm not the expert at knowing what the distribution of maker tokens is compared to other protocols. There are definitely some larger players.
to have a lot of maker allocations, but I think that's kind of true of most protocol governance tokens. So I can't really comment on whether it's more or less decentralized than any other really.
Fair enough Sam has make or dole has make or dole had any major attacks in the past
Yeah, I'd say the most infamous one was the Black Thursday event. That was March 12, 2020 when that scenario, similar to what you were just saying, the price of ETH dropped by 50% in one day due to the pandemic.
So that event resulted in a lot of liquidations. The maker protocol then was just launched. It was actually launched in November 2019. So it was actually only about five months old at the time. Market cap much, much
smaller than it was now. I believe we're actually it was under 100 million at that time so just very small. But yes that super devastating event happened and it was it almost was the end of the protocol but the people
I wasn't working there at the time, but the people working there managed to squeak through. So the bad thing that happened then was there was kind of a bug. I wouldn't really call it a bug actually. It was incorrectly defined
parameters where the auctions were 10 minutes long. So somebody was able to kick off hundreds of auctions all at the same time and bid $0 on all of them. So they ended up, I think, like getting a
about $8 million worth of youth collateral for free and that was a loss for the protocol. But there was an interesting effort that happened right after is everybody rallied together to have the maker that would mint to cover the hole in the balance
There was buyers that filled in this hole and recapitized the protocol and it carried on. I mean, the parameters could have been done better in hindsight, but it was an interesting task at the very beginning of the protocol.
Yeah, I do remember a lot of these early grandfather's of DeFi having issues here and there, but ultimately the community rallying together to make the, make the protocol whole and it seems like you guys have stood the testament of time.
I know that at least from a high level front end overview, MakerDow is pretty simple, right? You guys are an over collateralized stablecoin backed by Ethereum, WTC and a bunch of other aspects.
that's you meant die and might die as packed to the dollar. I know you've told us that you're now diversifying into ETFs, but would love to know if there are any major innovations coming up or anything exciting in the 2023 and the 2023 roadmap.
Yeah, for sure. There's a lot going on. So something interesting that happened recently is make or reactivated the die savings rate, which is the risk free yield that comes on the asset. So this is like normally you earn a yield, like if you have die and you can like lend it out
compound or something like that and get a return. But that die is borrowed so that yield is for you lending out your assets. Whereas the die savings rate is just the intrinsic yield that everybody has access to with you know the caveats of smart contracts
risk, but it's roughly the same risk as just holding die. So that was just reactivated December and up to it was set to 1%. But I I've heard there's people wanting to raise it to 2 to 3%. Once we get more of these
Real world asset deals online where we can get access to the Treadfy so deal. So that's an interesting development. I would say just on the real world asset front in general. This process has been going on for like, ooh.
I don't know since the beginning of Multi-Clet or die and finally seeing it come to fruition is pretty exciting so a lot of the legal structures and processes involved having a non-legal entity of a Dow be able to invest in real-world instruments
is pretty cool. And so we're seeing this now starting to scale up. So the monetalist deal is one of the bigger ones now, but we should expect to see more as the year goes on, especially with the interest rate environment we're in right now. There's a lot
about some money being left on the table by not having these things online. And then so on the technical front, makers expanding out to layer two side chains. It's probably, I'm in particular working on that. So it's probably one of the more complex things we've
taken on. So having Maker available on layer 2's, side chains, able to mint die on optimism and stuff like that. So that's coming, that'll be coming this year. So much stuff.
transition of locking down the bigger core down and then splitting out into sub-dows to encourage competition and innovation and new excitement. That's a big development that's really picking up speed right now as well. So yeah, there's lots going on.
So the splitting up into sub-dows. Does that encourage competition by giving those sub-dows or giving smaller entities with smaller voting power more influence? I would love to have some more incentive to that, please.
Yeah, so the sub-dow structure was thought of because of the increasing political issues that were forming within Make or Doubt governance. You know, things were all fine and good in the poll market, but bear
You know, you've got to do hard choices. You have to like lay people off and you know cut services just because there's not as much money as there was and it's a part of any entity really. And as a way to
deal with the political gridlock that sometimes occur in larger governance structures. And to me, this is very similar to politics and governance and stuff like that in the real world as well. To keep the innovation going, Ruin has proposed an endocrine where the
The sub-dows are formed and they have their own token and these sub-dows are free to innovate however they want. I mean, there are limits, but like basically some sub-dow wants to launch a new product. They no longer have to go through the core governance, which is very bulky.
and it's slow and maybe not everybody agrees with this direction. So with the sub-doub structure, people are free to split off into their own aligned camps and work on whatever they want. And if they're delivering value, then MakerCore can give them credit lines and stuff like that.
Very cool and honestly, no too much about the way subdows work and how each have credit lines and how each can have their own tokens. I wasn't even thinking along those along those lines. Sam, I know that there is I think it's this bark protocol. I'm not
I'm not too sure, but you guys are building out a lending protocol that's meant to compete with AVE. Can you give us some more insight into your plans for that? Well, we can see its release. Is it going to be available only on Ethereum first or is it going to come out, you know, come out of the cage multi-chain?
Yeah, sure. So Spark protocol where I'm going to launch that in April pending maker governance approval vote. Basically, the idea with that is that maker core only has access to certain features that people may want.
For example, as the examples I was given before, somebody may want to go leverage long on ETH against the stable coin. That's fine. They can do that in MakerCore. But let's say somebody wants to short ETH. MakerCore cannot currently do that. Or if they want to
cross collateralize their position. Maybe they want to collateralize it with ETH and Bitcoin and have the same debt denominated against both of those assets. Again, that's not something that MakerCore offers, but advance liquidity engines do. So stuff like that, as well as higher collateral
Make a core has a one hour Oracle delay, which means that they have to run higher collateralization ratio requirements, which means less capital efficiency. So maybe users want more capital efficiency. So this is also where Spark Protocol can step in.
It's basically to fill in all these missing pieces that make our core necessarily, can't necessarily cater to these users. So to give die holders the best experience, we want to have all these features basically. So yeah, that's the idea behind that.
Awesome, super exciting. Another DeFi product called the Playaround with. I'm a big fan. Let's see. I, you know, a colleague of mine read a news article that the MakerDow Constitution had planned to allocate
20,000 tokens from its reserves towards funding scientific sustainability initiatives. I'm not sure if you're able to further elaborate on that and the overarching vision with regards to this initiative.
Yeah, I mean, I can't really comment on that. That is a room to put out that post and he's outlined. Honestly, I'm not even that up to date with that particular piece. Yeah, no worries. So as we all know, the SEC has been extremely scrutinizing of stable quality.
issue viewers. To my surprise, they went after BUSC, which is issued by Paxos, heavily regulated in New York. This is kind of bizarre to me that they went after Paxos. So given that die is a stable coin, and it is backed by a basket of cryptocurrencies, also some of those
crunches being stablecoins. Do you think that die if it's not already may face regulatory challenges, particularly around issues related to compliance, security, anti-money laundering, anti-money laundering, and kind of all that stuff? So would love to hear your thoughts with respect to die.
Yeah, so I can't I'm not really going to comment on specific cases, but in general, it is a little disappointing to see the trajectory that some members in the US government have been taking. It seems this action is potentially going to drive user
to tether, which is who knows what tether it's fairly opaque. I would much prefer, I think I'm not a person who thinks all regulation is bad. I think regulation with such as centralized stable
Coins is very helpful to consumers and makes the whole ecosystem a lot safer if it's done properly. So I find this recent development, it's disappointing and I hope it course corrects.
That makes two of us. Does MakerDow ever plan on creating its own layer too? Are there any benefits in doing that?
Yeah, so it's interesting we're seeing happy with the layer 2's and layer 3's I think it's likely that Maker will it would make sense for Maker to Build its own app chain Now without be a layer 2 not necessarily I
I think with these ZK roll up technology, it's looking more like it's going to be layer one, Ethereum as a settlement layer, very expensive, but very secure. You have these layer two ZK roll ups, which are more pooling liquid
And then you have high throughput application specific chains on top of that in layer 3s. I think that's my best view of it right now. Granted, I'm not an expert in this technology. I'm an application developer. So I just use it. I don't understand all the
details quite yet and this stuff is very fast moving but that's my current view of how this may look. It's super interesting Sam I actually always you added a layer on top of it so I always be imitated as Ethereum being a chain of proofs and then all the transactions
having on highly scalable, highly efficient layer 2s and roll ups side chains. So you're saying that even one step above that layer 3s can come in and make things even more scalable than that. Yeah, exactly. Like you get these ZK roll ups that are
like roll ups of roll ups and it just it just increases the throughput. If you trust the math then you get this trade-off. Now you don't get it for free so there's like trade-offs with pooling liquidity so that's a concern. Like you can't just have everybody
I load away in their own app chain completely because you have issues with the quality. How exactly this works out? I'm still learning and updating my views with everybody. I think that's looking to be a pretty likely scenario in my view.
Awesome. Well, look Sam, I have a community member that usually asks a spot on question. So I'm going to pass the mic to her real quick. I should go for it.
I see that. I was thinking what is water turned out on the proposals that are put forward for voting and what incentives are you offering to the voters to participate in the voting process?
Yeah, so currently there is no extrinsic incentives to vote. I believe as part of the end-game plan
that Brune is putting out, it will offer a yield on a maker that has been delegated to vote, but currently there is none.
and just read on your Twitter page that any implementation that represents a technical change to make a draw or the make a protocol has to be included and enacted in a further
executive vote. I was wondering executive votes are carried out by Make a FDOW foundation. What is the role of the Make a DOW foundation and how does it contribute towards dual-appent and growth of the Make a DOW ecosystem?
Yes, the Maker Foundation dissolved. When was that? It was the summer of 2021, I believe. There no longer an entity, the word executive vote
maybe it's a little bit misleading, but it's just something that executes on chain. It has nothing to do with authority other than the authority of the maker holders. It's a purely on-chain smart contract.
Thank you so much for answering. No problem. Thanks Aisha. Captain Levi, you're next.
Thank you. Okay, so from my understanding of one of the segments we made, I get the concept that users can actually look up their cryptocurrency holdings as collateral to get even more data again. And then specific crypto that
that this guy cannot try to unlock of, for example, and they already well known like, you know, it's quite a theorem and B and D and B. What kind of more requirements would these tutu cranes need to meet before they can be locked up on mechadal?
Yeah, so any collateral that gets onboarded to the maker system needs to go through a collateral onboarding process. So the maker holders have to approve any token that gets onboarded. And there's all kinds of criteria to the
determine whether that happens or not. And as I said before, Maker has shifted only being only interested in highly scalable collateral, and this really is basically restricted to Bitcoin, ETH, and liquid-staking derivatives as of right now.
So I would like you to connect to the emergency shots down process that I am seeing on your technical docs because I am also seeing here that dialogue
So that's an actual review with Dean Dive for the collateral. After an emergency shutdown processing period, could you give me an overview of the emergency shots down process and how does it connect?
Yeah, really good questions. So emergency shutdown is a minority token holder protection mechanism. This is to prevent the case where governance, somebody who is malicious gets enough of the maker
tokens to execute some malicious code. Now, what emergency shutdown is is that if there is 150,000 maker put into this module, it will shut down the whole system. And it makes sure to award
the collateral backing pro rata to the amount of die at the value of $1. So this is an irreversible process that ensures that die holders have an orderly exit to collateral. And this is very important because not only does it protect
back against these governance attacks. It gives holders of die confidence that if something goes wrong and people are all panicking and exiting in a worst-case scenario, you will still be able to get back all of the collateral. And that's important for confidence.
Captain leave I you there man I know you might have you see it. Hey Venice go for it brother
Yeah, no, thank you so much. Okay, I want to note that is there a time limit for dive orders to claim their remaining collateral after an emergency shutdown?
Did you say a time limit? Yeah. Is there any time limit to offer the emergency shutdown so that people can buy wonders can claim their remaining intellectual? No, there's no time limit actually funny story so single collateral die the beta version of multi collateral
die was shut down and actually if you check on CoinMarketCap or whatever you can see, SIE is trading at about $8 because it's redeemable for the value of what ETH was when it was
shut down in like it was 2020. So ETH was trading around $300 at that time. So single collateral diet is still redeemable for that ETH and that's why it trades at the equivalent value increase that ETH experienced even years later.
Okay, I understood. And while I was going through the white to brand new mentioned, actually the data provides a list of emergency situations that could trigger an emergency shutdown, but it does not clearly see
specify the specific conditions or criteria that were prompt to make a goal and initiate such a shutdown. So, Kuchup, please explain a little bit more about this aspect of your project.
Yeah, so I mean there is no strict like on chain requirements other than you need to have 150,000 maker and to be clear you have to you have to destroy that maker so you have to be very very sure that what you're doing
doing is what everybody wants. And what this would, like it can be any number of things, but what it would probably look like is somebody that was able to gain, I don't know, 20, 30% of the voting share for what
whatever reason, maybe they've brought people who knows, and they want to steal all the collateral or something like that. It is clearly not a desirable action by anybody. So there is this two-day delay that if they were to execute some malicious action like that,
it would set off alarm bills right away. And if there was not enough time to have a counter action of collecting that, the last line of defense is this emergency shutdown.
holders who wouldn't don't have enough to overpower the malicious attacking vote but have 150,000 m, which is about 15% of the supply, they can trigger an emergency shutdown and then everybody is made a hole again at the end.
Okay, it makes sense. And one last question for my side. What kind of metrics can be used to assess the reliability of the emergency orical system and
How can the data related to the selection of emergency or equals be analyzed to determine the effectiveness of the selection process in choosing just for the actors?
Right, so you can look at the assets and liabilities. The site I usually use is makerburn.com, which is M-A-K-E-R-B-U-R-N.com. So that will show diode standing. It'll show
So, diet standing broken down by collateral type, how much collateral is locked in the system, so you can be confident it's over collateralized. And for the newer stuff with real world assets, I'm an advocate of getting, I think some of the Oracle networks are starting to do this with the
have Oracle present for the ETF. And getting more of this stuff on chain is the key to having it be fully transparent and understanding what your assets versus liabilities are.
Okay, okay, Anderson. And yeah, thank you. Thank you so much for answering my questions.
the JavaScript library from the looks of things is actually a unique built JavaScript library where developers can actually you know, build, um, defy applications on make our platform. So this library, um, did you guys, uh, I guess
they must be focused from other major similar protocols. How does the process, if I be able to build a DEFY application, how is the process done so that it can become officially recognized by the MECADAO protocol?
Sorry, which JavaScript project is this? I haven't worked with JavaScript in a while. Oh, okay. I'm still on your technical docs. The digestible script library of the Macon. I don't know if you're aware of that.
Yes, sorry, I understand what you're saying now. Yes, I actually personally haven't really used that. But yeah, the team made that
before I joined. But yeah, it's used for like querying smart contracts and stuff like that for my understanding.
Okay, that's actually nice. My final question is about your book bouncy from my understanding. I'm guessing I'm seeing that it's often under some terms set by MIT 64 and from the summary you provide
they are actually rules and it's still connected to governance. So when someone presents a possible threats, how quick is your reaction to, you know, assess that threat because this is basically one of the core
items that need to be frequently checked. But from what I am seeing here, it says that the process needs to be sped up. What's the response when people present possible traits that may need some attention?
And this is the bug bounty program you're referring to MIPS64. Yes, the bug bounty program for MIPS64.
Yeah, so we're running a normal bug bounty program just like any other protocol. So if somebody finds a critical exploit in the smart contracts, they can, there's a process to submit that and then there's many, there's many ways we can deal with that. If there's an emergence
situation. There are, we have a tech ops team doing monitoring stuff like that just to always be alert of what's going on in the system. And then it really depends on the situation after that. Whether a vote can be rallied
Maybe the smart contract but can be white hat hacked, it really depends on the situation after that. Thanks a lot Sam, for answering my questions. I'm watching you guys very best and I hope to make our top project continue staying in position. What's your know, thanks Noah.
Thanks so much. Hey, thank you Captain Levi. And I think we have Sam next and then we'll go to say it and we'll wrap things up.
Hey, so I was just wondering, so you mentioned dye is a synthetic asset peg to USD. I'm just wondering why that like what do you think is the reason why that isn't like a another kind of
like peg to like GBP or euro or just interested in hearing thoughts on that. Oh really good question. I think they actually have been attempts to do that. It's just the world loves the US dollar so
everybody transacts with it globally. So I think that has less to do with crypto specifically and more just the world at large. But that being said, like having synthetic assets of different types of
of assets is super valuable. So one of the next things that makers working on is ether die, which is, you can think of it exactly like die. It uses the multi collateral system, except it's one to one pegged with a eith.
This is very useful, especially now that the Shanghai upgrade on the theorem is going out like with staking derivatives of ether becoming very popular. And so this will give maker a seat at the table in the ecosystem that it lives in.
I had another question as well, so I think we're supposed to bring you to die holders. I think that's really amazing. But I've just had a question. Do you feel like there
So the kind of centralization of pursuing that yield strategy is that odds with the kind of decentralized ethos of maker or do you feel like those two can kind of like coexist if that's clear?
Yeah, so makers over it's kind of taken this line of being a middle ground. As I said at the beginning of the call here, you have to make trade-offs when you're building a stable coin.
So in order to scale up to the size of billions you have to have some degree of exposure to the instruments that are close to the underlying asset. It's like a force of nature. You can't get away from it. So finding this value
balance between having a stable coin that's a one US dollar and you can use it and be confident in it along with the parallel efforts to buy ETH collateral to back die with that to give preferable rates to
people who want to back their die with decentralized collateral such as Heath. This is always a balance that just needs to be struck and yeah, I think is correctly finding the middle ground between those two.
Now we have some super interesting and yeah I love makeup and best of luck for the future. Thanks.
Thanks a lot Sam. Say it your next sir and then wrap things up. Yeah, thank you. Okay, so you have been talking about this year world assets. I was wondering that
which real world assets in future will be used as a collateral for the rice stable coin or this proposal has been turned down and can fiat currencies also be used as a collateral in future maybe.
for the di-stable coin? Yes.
Yeah. So anything can be used as collateral, but it has to be tokenized on chain or some sort of agreement. The best scenario that Maker wants is to have fungible assets that are tokenized
on chain with very liquid secondary markets and strong Oracle prices. So if Maker has this, it doesn't matter if it's like a crypto native asset or a real world asset. I mean, USDC is a real world asset. It's probably the closest thing we have to actually
will cash in the real world, but it needs to live on the blockchain, so you have to tokenize it. If Maker has that and the collateral can scale, yeah, that's something that Maker would be interested in. - God, thank you so much, Francine. How are you, Mark?
Great, thank you Rahmat. Hey Sam, thank you so much for coming on today. I know you're a busy guy. You guys are building amazing things over there at MakerDow. So we really appreciate you coming on to WhaleCoinTalk, speaking at the aquarium and really giving us insight
into all the developments and the origin story and nuts and bolts and nuances of MakerDout. So if you have any final words to leave our audience with, go ahead and use so now. Otherwise, I'll wrap up the space.
Yeah, first I'll say thanks for so much for having me on this was a lot of fun for people who want to get more involved I would say pay attention to the recent developments get involved in the forum makers Getting you know has kind of a
view of maker being like more conservative in old school and they don't really do things, but with some of these changes with the end game proposal that ruin is putting forward, maker is going to be moving fast and innovating. So you can get on the ground floor and get get involved with the new developments there.
Right on. Ladies and gentlemen, that was Sam McPherson of the MakerDow ecosystem. Remember that everything you hear on WhaleCoinTalk is meant for educational purposes only. Nothing is financial advice. So be safe out there. Everyone will see you all tomorrow. Take care.