Question on our reliance of $wxdai

Dear all,

Just wanted to raise a discussion on our sole reliance of wxDAI as our stablecoin and payments currency, whose future may be uncertain in the case its DAI backing be put into question.

Talks in the GNOSIS DAO raise more questions than answers to me - the stability of xDAI <=> DAI has been a conscious design decision inside xDAI Chain since its inception; however, if DAI alters its peg, so would xDAI. By extension, the full extent of these decisions would permeate through all TEC wallets.

Our funding mechanisms rely heavily on this USD stability. Therefore, I ask - should the TEC consider to pass through a pre-emptive proposal to shield us from a sudden change, e.g. diversify our stablecoin basket, or instead have a fallback mechanism to our common pool to convertXDAI() iff wxDAI falls below a certain threshold?



Hey @rex, good call. I just think it’s too early to have this conversation.

On our reliance on DAI and diversification, I believe @natesuits and the 12th Rune Group will take care of diversifying our treasury and I believe stablecoins should be part of that.

About the DAI situation:

  1. I don’t think there’s much we can do, DAI is, for obvious reasons, the biggest liquidity on our fairly small chain.
  2. Any changes on DAI won’t be happening soon (see this post by Maker’s co-funder on how the de-peg would take minimum 3 years to happen Maker has a fairly great track record and they aren’t likely to do any movement without extensive research, we at least should be happy that they’re actually putting the work in and thinking about solutions.
  3. We shouldn’t mind much about DAI depegging, or at least not until there’s a clearer view on how are they going to achieve it, say like copying RAI’s mechanism or so. I’m actually fairly happy seeing DAI moving from USD after the recent issues on the space.

@enti I wouldn’t turn down the argument so quickly.

Though I appreciate the efforts that the 12th Rune Group will partake in, the goal of said group is not to be granted an amount comparable, or larger to our .75$million common pool. Talks are in place, of course, but our complete reliance to one coin will remain.

Further, I’m sure there’s more intricate methods, but I refer to risk management 101:

Given that the normal functioning of the ABC wholely depends upon xDAI, and that the likelihood of a depeg is unlikely, the TEC ABC could be placed in medium risk.

Further, your argument completely disregards the original event, or set of events, which have caused the MAKER community to freak out in the first place.

It isn’t what maker do, but also what gnosis do, and what regulators do.

The unregulated issuance of stablecoins does not rejoice legislators, especially in the aftermath of UST.

Imo we should consider a mechanism to shield us from a dai depeg, rather than changing the structure of our abc