While revealing the protocol’s inability to adhere to regulators, Christensen suggested that “we should pick the path of decentralization.”
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In light of the recent discussions around depegging its native token from USD Coin (USDC) amid sanctioning of Tornado Cash, MakerDAO co-founder Rune Christensen reached out to the city explaining why free-floating DAI could be the only option for the decentralized autonomous organization (DAO).
In his blog post, THE ROAD of Compliance and the road of Decentralization: Why Maker does not have any choice but to get ready to free float Dai, Christensen disclosed miscalculating the risks linked to risk-weighted assets (RWA). He stated:
Physical crackdown against crypto may appear without advance notice sufficient reason for no chance for recovery even for legitimate, innocent users. This violates two core assumption that people used to comprehend RWA risk, making the authoritarian threat much more serious.
While revealing the protocols inability to adhere to regulators, Christensen suggested that people must pick the path of decentralization, as was always the intent and the goal of Dai.
He believes that decentralizing Maker would decrease the impact of crackdowns on the entire protocol, adding that “The only real choice is then to limit attack surface by reducing RWA contact with a maximum fixed percentage of the full total collateral – this involves free floating from USD.”
It is very important remember that over 50% of DAI happens to be collateralized by USDC, as evidenced by daistats data.
Joey Santoro, the founder of the decentralized finance (DeFi) platform Fei Protocol recommended revoking participation from Tribe DAO after reimbursing Fuze victims.
Previously, Rari Fuze hacker was offered a $10 million bounty for returning the $80 million worth of assets, but Fei Protocol received no response from the attacker.