Maker targets $100 billion in stablecoins
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Maker targets $100 billion in stablecoins
Artificial intelligence will be used to search forums, helping members make informed decisions.
Navigating Web3 tides with focused insightsBy Aleks Gilbert
Translation: Mars Finance dlnews, Daisy
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Investors are pinning high hopes on a sweeping overhaul of the Maker protocol.
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Maker’s founders aim to create a stablecoin for the masses.
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Plans involving artificial intelligence must wait for technological advances.
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This effort continues a long-standing quest to find features that bring crypto into the mainstream.
Despite a booming stablecoin market and financial giants launching their own dollar-pegged tokens, Maker's DAI has lost momentum.
DAI has a token supply of around $5 billion, but emerging, fast-growing stablecoins are closing the gap. Meanwhile, established stablecoin leaders Tether and Circle are extending their lead.
But an ambitious and controversial reform plan proposed by Maker co-founder Rune Christensen is just weeks away from a phased rollout.
First introduced in 2022 and dubbed "Endgame," the plan includes a rebranding, new tokens, new ways to earn yield, so-called subDAOs, and artificial intelligence—all aimed at revitalizing MakerDAO, the cooperative running the Maker protocol.
But they also aim to make Maker and its new stablecoin mainstream.
Christensen said in his latest primer that the goal is to grow DAI's supply to “$100 billion and beyond”—slightly below Tether’s $114 billion.
“We want to be able to attract a much broader audience,” Christensen said.
That’s a tall order.
While new products often claim they will “capture the next billion users,” most DeFi applications serve only thousands.
Controversy Over Endgame
A stablecoin is a token designed to be pegged to another asset—usually the U.S. dollar.
They are the closest thing to cash in the crypto economy and one of the few blockchain-based products with real-world utility.
Maker’s DAI is seen as a “decentralized” alternative to USDT and USDC, two stablecoins whose issuers can freeze or seize funds, much like money in a bank.
Christensen calls Endgame a “Trojan horse” to deliver decentralized money to the masses. But the proposal has been contentious.
Over the years, it has undergone countless revisions, sometimes sparking heated votes, with critics accusing Christensen of abusing his outsized influence within MakerDAO.
Endgame does have its supporters.
Mark Phillips, co-founder of Steakhouse Financial, a crypto consultancy working with MakerDAO, told DL News: “Right now, our parents and grandparents aren’t logging into Maker.” Endgame could change that, he said.
Investors appear to like the plan. MakerDAO’s governance token MKR has performed strongly this year, rising over 60%, compared to a 34% gain across the broader crypto ecosystem.
Rebranding Maker
The first step in Endgame’s “launch season” will be unveiling Maker’s rebranding, along with the names of its new stablecoin and governance token.
A month later, both products will launch alongside a new mobile app.
To access Endgame’s main feature—yield farming—users can choose to upgrade their DAI and MKR into “NewStable” and “NewGovToken.”
Users can earn interest on the new stablecoin via Maker’s existing savings rate (7% as of Friday) or in the form of the governance token.
Holders of the new governance token can “activate” it to earn yield and participate in Maker governance.
The most loyal members of the cooperative can earn even greater rewards by locking up MKR or the new governance token on the platform.
“This is the best place for long-term savings and value appreciation,” Christensen said.
He said these incentives should attract new voters to MakerDAO, which is currently dominated by “whales” who hold so much MKR that they feel obligated to participate.
Phillips agrees.
“A common problem in crypto and DeFi is that people often lack motivation to engage in governance,” he said.
Artificial Intelligence
The final step will be launching Maker’s first subDAO—a cooperative within the MakerDAO cooperative.
The first subDAO will oversee Spark, a year-old lending protocol inspired by Aave, launched by Phoenix Labs, led by Spark founder Sam McPherson.
SubDAOs aim to address a problem plaguing MakerDAO: cumbersome bureaucracy. By outsourcing management of certain functions to sub-organizations, volunteers helping run MakerDAO won’t be so burnt out, Christensen said.
But the plan has hit obstacles.
Christensen initially hoped to launch several subDAOs simultaneously.
Instead, only the Spark subDAO will launch first, with others following as needed, Christensen said.
That’s because Endgame placed big bets on artificial intelligence.
“Things are kind of complicated right now with MakerDAO governance,” McPherson told DL News.
Eventually, AI will be used to scan MakerDAO’s forums, where members discuss proposals and service providers share data and progress reports.
The hope is that AI can distill forum activity and help members make informed decisions.
AI will “help the average voter understand in a very simple way whether things are going well or not going well,” McPherson said.
But AI isn’t advancing fast enough.
“AI is really great in most cases, but it also has many hidden bugs and small issues that make it unreliable,” Christensen said.
Meanwhile, Maker’s co-founders believe a fresh, cohesive brand and the ability to earn yield through tokens will drive mass adoption.
“In that sense, it’s kind of an experiment,” he said. “Maybe what crypto has been missing is the effort to actually make it accessible to everyone.”
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