Maker DAO Votes In Multi-Collateral Lending
The launch of the first multi-collateral lending is scheduled to arrive this November 18.
Maker DAO has already voted in the multi-collateral lending, expecting to launch the first contracts this November 18. The event will generate two types of DAI tokens, and the old Ethereum (ETH) collateral DAI will coexist with the new lending scheme.
To avoid risks and instability, the Maker DAO Risk Team and the Maker Foundation have decided on a slow and conservative transfer between the two types of collateral.
After the switch, the new multi-collateral stablecoin will be traded as DAI, while the old asset will be rebranded to SAI, to represent the single collateral. There will be no chance to switch between the old and the new asset, to avoid a chaotic sell-off of the old stablecoin. Instead, Maker will build a smart contract to exchange SAI to the new DAI, to keep both coins pegged to their $1 intended value.
“When the community has determined that it is no longer possible to effectively manage the Sai ecosystem, or desirable to do so, an emergency shutdown will be triggered in SCD. An emergency shutdown is essentially an unwinding of the protocol, which allows Sai holders to redeem their tokens for $1 USD worth of ether (based on the oracle price at shutdown) and CDP owners to collect their collateral, minus the balance of their drawn Sai,” explained the Maker team.
In the past week, the issuance of single-collateral DAI rose significantly, moving up from a recent low at 79 million. DAI kept to its dollar peg, though some ETH positions were liquidated during the mid-October market sell-off.
The regained trust in Maker DAO increased the ETH used as collateral to above 1.7 million coins, up from a low of 1.4 million coins a couple of weeks ago. MKR prices are up about 7% to $547.40. The Maker DAO stability fee was also lowered to 5.5%, signalling increased trust.
So far, the Maker crypto lending scheme has survived, with only occasional liquidations, and no mass panic. The ETH use case as collateral keeps the prices relatively stable, at around $187.24. The ETH2DAI and Maker smart contracts are still highly active, with more than $43,000 in monthly gas fees.