MakerDAO Details Preparations For Multi-Collateral Dai Release
Around a month and a half ago, Maker (MKR), the project providing “equal access to high quality financial services,” released the code for its “Multi-Collateral Dai (MCD)” to the public. Six weeks have passed since the MCD code has gone public. Since then, investors have waited for the implementation and release of this update on the mainnet. The MakerDAO team published an update on Medium today which details their path to the mainnet launch.
Multi-Collateral Dai on MakerDAO
For those who are unfamiliar with the platform, Dai (DAI) is Maker’s stablecoin, though it’s a little different than traditional stablecoins. Most stablecoins are backed by U.S. dollars, which means their value is still reliant on the government. That middle-man defeats the point, no?
Instead, Dai is based entirely on a blockchain with no involvement from the government or other legal entities. But what backs Dai then? Well, Dai is actually collateralized with Ether on the Ethereum blockchain rather than any fiat currency.
Essentially, investors will place Ether into a collateralized debt position – putting their Ether up as collateral in exchange for Dai. Put simply, the MCD release will make it so other assets can be used as collateral for Dai, not just Ether.
Why Hasn’t the Update Been Released?
First off, MakerDAO details its commitment to quality code, especially regarding security. Since the code has been made public, community members have had time to look at the system and find any bugs or other issues. Also, Trail of Bits, a security group that reverse engineers code to find vulnerabilities, is auditing the technology and will present its findings in a couple of weeks. Then, once these issues are fixed, the updated version of MCD contracts will release onto the MakerDAO test net.
Then, a Maker team will test out rare occurrences such as “emergency shutdown, price feed freezing, collateral claims processing.” These issues could destroy the network if they happen while it’s live, so the team is looking to prevent them ahead of time.
A “Savings Dai” will go live as well, enabling users to switch Dai into “savings mode.” This mode works along the same lines as a traditional savings account, where investors can lock their Dai for it to grow over time.
MakerDAO also features Oracles — systems that collect relevant data from off-chain sources that can be used to trigger smart contracts. Due to the MCD, the Maker network will need to handle multiple price feeds for different coins. Much of that work will offload to Oracles. However, the MCD test net will see “Scuttlebutt” implementation to “communicate prices between each other” before “submitting the combined result to the blockchain in a single transaction.” This is to minimize network congestion.
The MCD update will also modify the network layers. The middle layer, for example, automates the gathering of data and its implementation into the rest of the system:
“The MCD release will include the first production-ready GraphQL API service that is backed by VulcanizeDB. This is a service that continuously collects MCD-related data from the Ethereum blockchain as new transactions are being mined. It then makes this data readily available in the form of read models for clients that require high-performance read access; an essential building block for real-world applications on top of the MCD platform.”
Other Changes in the Update
Less on the technical side, the Maker platform will receive a usability overhaul. All interface redesigns will simplify users’ relationship with the collateralization process. These changes are all based on user feedback.
A “Dai Redeemer” service will enable a smooth transition between Single-Collateral Dai into Multi-Collateral Dai. The Maker team claims to be working with all partnered assets to streamline the upgrade process even more. Once this change hits, users will have six months to smoothly upgrade to the MCD before an “Emergency Shutdown” of the Single-Collateral Dai system.
Finally, the MCD update will launch with support for a variety of assets. However, that list will be generated via community governance. This process will occur sometime before the MCD main net launch.
More Crypto News
Tether (USDT), the world’s most popular stablecoin, is designed to give users the stability of…
Stellar and its XLM token were first launched in 2014 by Ripple co-founder Jed McCaleb.…
Bitcoin Cash (BCH), the controversial project forked from the original Bitcoin client, is now the…