It's Devcon! A time for crypto bros and girls of all nationalities to get together and commiserate over the pain of the current bear market. Sorry, "build" market. But just because it's a bear market doesn't mean things aren't happening. The newly installed CEO of a prominent DeFi protocol was accused of bestiality, for example. Or how about the SEC - they just launched an investigation into whether monkey JPEGs constitute securities. Some days you just feel blessed to be working on the future of finance.
Another thing that happened this week was that Maker DAO voted to buy $500M of US treasuries and hold them in a bank account. I'm not sure what to think of this. On the one hand, it seems ridiculous on its face. Half a billion dollars of collateral backing the decentralized, censorship-resistant stablecoin of the future has been handed directly to the US government via the traditional financial system - literally the exact same system that Maker is supposed to be disrupting.
But on the other hand, it isn't all that different from Maker holding USDC. USDC are just IOUs for dollars in a bank account somewhere that are themselves invested in US treasuries. Why not cut out the middleman and invest in the treasuries yourself and earn the yield that USDC currently keeps for itself? This vote is shocking because it puts on full display the naked truth - Maker is 100% vulnerable to an attack by the US government and has been for years.
Not that Maker is unique in this. Effectively all DeFi protocols are vulnerable to US censorship by virtue of the fact that effectively all DeFi protocols support USDC or other stablecoins that themselves support USDC (like DAI and FRAX). I've accepted that, as have we all I think.
My question is why anyone gives Maker their USDC in exchange for DAI when Maker is going to lend that USDC to the US government and not give you any of the interest. This is exactly what Circle does! Maker has said "enough!", but why haven't Maker's USDC depositors? Maybe they'll start to. If the US government is good enough for Maker, maybe it's good enough for you too, anon.
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