Quantstamp Observes: An Emergent Form of Decentralized Governance in Ethereum Comes Together to Act as a Backstop to Maker -- with Smart Contract Coverage Warranty via Chainproof
Pubblicato il: 03/04/2020 20:07
SAN FRANCISCO, April 3, 2020 /PRNewswire/ --
On March 12, 2020, the stabilized digital currency using distributed computing and smart contracts known as DAI, fell off its peg of roughly $1 USD. This put the entire Decentralized Finance ecosystem of interlocking open finance tools critically at risk. At a recent peak in February 2020, over
During extreme market volatility, blockchain transaction congestion and insufficient network parameters, the Maker system became overburdened by approx. $4.5M in undercollateralized "bad debt." To fill the shortfall, clear system debt and restore the DAI to its peg, the Maker
To protect the auction, the DeFi community rallied together forming the
Quantstamp stepped in to quickly secure the syndicate software protecting the community assets and independently shore up network parameters during the auction with technical support from
"It was inspiring to see the DeFi community rally together so quickly to form a 'buyer of last resort' syndicate, starting with only 1 DAI," said Richard Ma, CEO of Quantstamp. "This reduced the barrier to participation and helped stabilize the ecosystem—essentially an emergent form of community governance."
If these "buyer of last resort" bids are won by the decentralized syndicate, contributors receive network assets proportionate to their DAI bids. The auction set the minimum check size of 50k DAI greatly reducing participation. While the software and its funds were under a
These sorts of governance like actions, at this scale, are unheard of. This backstop, with over 400,000 DAI gathered, has community participation from enthusiastic #DeFi ecosystem members from the US, Italy, Argentina, China, and more.
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