nikolai.fyi

Note on MKR consolidation

In the last few days I got inquiries from a few different groups asking to clarify a few points about the MKR distribution and voting.

A certain chunk of 100k+ MKR has recently ended up split across several different voting proxies:

0xbabe00fed3dd377717ca7bf44715457470cecca1

Recently active through:

0xd48d3462c5e5a5d568c8f8ec3366241ed8b46bd1

Now has multiple vote proxies:

0xefbc9554276f7d617bdd680892feb6f206511610

0x23d4c08abbac483577d03397b0003cc22a481354

0x3c1265988e7bb9c3215677b740d88930c4d65ace

Direct voting balance: 0xd50a47f7d9a4c5dce028317dbaa62cb4ebd11812eb9196555ccb4ca8a4a38780

I responded that based on past statements, it seems that the original chunk of MKR was partially held on behalf of other people, and is now in control of the true owners. (Edit: It could also be a mix of releasing funds held in custody and of personal sales - I am just guessing at possibilities that would be consistent with past statements).

However some investors expressed concern and surprise at this MKR movement, especially in combination with recent move to transfer the undistributed MKR out of the multisig and into MKR voter control. (Edit: It looks like actually it’s the MKR mint/burn permissions given to MKR voters. In my opinion this is actually worse because it’s explicitly giving them control, when it could be that only the parts of the system that actually need to mint/burn that are given control. The key point still stands, it is now controlled by a single person or unidentified group, not “locked out”). I think it is important for MKR investors as a whole to be aware of this activity, as the change in effective control of large amount of undistributed MKR could, theoretically, materially impact their financial decisions.

I haven’t been too concerned with what goes on with the MKR distribution because it personally makes no difference to me. The MKR voters chose their path when the voter roll call in April 2019 did not have enough turnout to contest the first big multisig rotation.

That said, here’s a throwback to a post from ~3 years ago about my general position with respect to the role of MKR voting:

https://steemit.com/makerdao/@nikolai/maker-doesn-t-really-have-voting

I also recommend reading Vitalik’s recent post on “credible neutrality”, if you haven’t seen it yet:

https://nakamoto.com/credible-neutrality/

As an aside, my steemit post has a bit of an easter egg in the comments:

Maker is not intended to be a dynamic, intelligent system (e.g. a company offering a software service). It is a dumb mechanism that is a financial tool.

Last I checked MKR is full of human inputs influencing the system and I am not even talking about the first DAO actually created purely by selected humans.

The remaining human inputs (besides the dai engine operations) are the market price feeds for various tokens. We will see whether we can truly lock ourselves out or if we will have to go with a curated set of feed sources indefinitely.

With Uniswap/Balancer and other new mechanisms for on-chain price oracles, and with related methods for automatically insuring and setting risk parameters for arbitrary tokens, it makes me happy how much progress we’ve made towards our original goals.

keybase.PUB/nikolai