Understanding MakerDAO Governance

MakerDAO’s decision-making process involves Governance Proposals, Governance Polls, and Executive Votes.

MKR holders exercise their voting power to approve or reject changes within the Maker Protocol and the DAO itself.

Here are the stages of Maker’s governance process ↓

New proposals are now open for voting on the Maker Governance Portal.

Following @phoenixlabsdev's latest suggestions on the Maker Forum, three active polls are now open for voting on proposed changes to Spark’s MetaMorpho Vault, and SparkLend.

[Mainnet] Update Spark’s MetaMorpho Vault Supply Caps

Due to the recent shift in demand towards sUSDe collateral pools, and based on @BlockAnalitica's recommendation, this proposal aims to increase the capacity in sUSDe pools to match their USDe counterparts:

• Increase the sUSDe 91.5% LLTV pool supply cap to 200 million DAI

• Increase the sUSDe 86% LLTV pool supply cap to 500 million DAI

[Gnosis] Onboard USDC.e as a Borrowable Asset

Gnosis Chain has introduced USDC.e, a new USDC token complying with Circle’s standards. Over the next few months, all USDC activity on the chain will transition to this version.

To maintain access to USDC liquidity on Gnosis Chain, it's recommended to list the new USDC.e token on SparkLend.

Initial parameters for USDC.e are detailed in the forum post: https://t.co/XSUN0oAycV

[Gnosis] Update USDC Parameters to Prepare for Offboarding

On-chain liquidity for the old version of USDC on Gnosis Chain is expected to decline in the coming months as usage transitions to the new USDC.e token.

To address this shift and protect user experience, a gradual deprecation of the old USDC token from the Gnosis Chain SparkLend market has been proposed.

If approved, these changes will be included in an upcoming Executive Vote.

Check the active polls on the Maker Governance Portal:

The latest Executive Vote has been approved by Maker Governance.

→ https://t.co/YRMNTkJv26

The changes described below will be executed within the Maker Protocol on June 17th at 14:00 UTC.

⚡ Spark Proxy Spell

A Spark proxy spell at 0x258FD2E6b5C155aa5f3e84326A622288bd70f376 will trigger the following change:

Onboard weETH to SparkLend on Mainnet

@ether_fi’s weETH will be onboarded to SparkLend on mainnet with the following initial parameters:

• Loan to Value: 75%
• Liquidation Threshold: 73%
• Supply Cap: 5,000 weETH

For the complete list of parameters, visit the Executive Vote link at the beginning of this post.

🚨 Disable Starknet Dai Bridge

To transition from the old Starknet Dai Bridge to the new version maintained by Starkgate, deposits on the old bridge will be disabled. Withdrawals will remain possible.

💰 Launch Project Funding

The following transfers will be made to the Launch Project:

• 5,000,000 DAI to 0x3C5142F28567E6a0F172fd0BaaF1f2847f49D02F

• 450 MKR to 0x3C5142F28567E6a0F172fd0BaaF1f2847f49D02F

Funds will continue supporting the development of various areas, including Marketing and Branding, advanced language AI systems, Ops tooling, Spells, Risk, SubDAO Development, Legal, Infrastructure, and Stability projects.

💵 USDP Jar Housekeeping

Following the recommendation of the Governance Facilitators in collaboration with the spell team, the following operations will be performed:

• Raise PSM-PAX-A Debt Ceiling to 2,000 DAI.

• Call push(uint256 amt) on MCD_PSM_PAX_A_INPUT_CONDUIT_JAR with an amount of 1,159 USDP.

• Call void() on MCD_PSM_PAX_A_JAR.

• Set PSM-PAX-A Debt Ceiling to 0 DAI.

This will result in:

• Debt Ceiling remains at 0 DAI after the transaction is executed.

• Dai generated from PSM_PAX_A increases by 1,159 DAI.
USDP balance of MCD_JOIN_PSM_PAX_A increases by 1,159 USDP.

• USDP balance of PSM_PAX_A_INPUT_CONDUIT_JAR decreases to 0 USDP.

• Surplus Buffer increases by 1,159 DAI.

💸 May 2024 Aligned Delegate Compensation

Transfers for Aligned Delegate compensation will be made to qualifying Aligned Delegates, totaling 210.81 MKR.

💸 Q2 2024 AVC Member Participation Rewards

Distributions totaling 100.08 MKR will be made for Q2 2024 AVC member compensation. This amount is prorated to two months due to recent amendments to The Atlas that removed the AVC Member role.

Recently, MakerDAO deployed a D3M to Spark’s MetaMorpho Vault, enabling @sparkdotfi to allocate 500 million DAI to Ethena’s USDe and sUSDe markets paired with DAI.

In collaboration with @BlockAnalitica, this thread details how top-tier risk management ensures the financial viability of this large-scale integration. 🧵

A new Executive Vote is live on the Maker Governance portal.

🗳️  https://t.co/YRMNTkJv26

MKR holders and delegates can use their voting power to deploy the changes listed below if they support them.

If this executive proposal passes, the following actions will occur within the Maker Protocol:

⚡Spark Proxy Spell

A Spark proxy spell at 0x258FD2E6b5C155aa5f3e84326A622288bd70f376 will be triggered. The expected contents are as follows:

Onboard weETH to SparkLend on Mainnet

If the Executive Vote passes, @ether_fi’s weETH will be onboarded to SparkLend on mainnet. The initial parameters and risk assessment are based on current market and liquidity conditions:

• Loan to Value: 75%
• Liquidation Threshold: 73%
• Supply Cap: 5,000 weETH

For the complete list of parameters, visit the Executive Vote link at the end of this post.

🚨 Disable Starknet Dai Bridge

To transition from the old Starknet Dai Bridge to the new version maintained by Starkgate, deposits on the old bridge will be disabled. Withdrawals will remain possible.

💰 Launch Project Funding

The following transfers will be made to the Launch Project:

• 5,000,000 DAI to 0x3C5142F28567E6a0F172fd0BaaF1f2847f49D02F

• 450 MKR to 0x3C5142F28567E6a0F172fd0BaaF1f2847f49D02F

Funds will continue supporting the development of different areas, including Marketing and Branding, advanced language AI system, Ops tooling, Spells, Risk, SubDAO Development, Legal, Infrastructure and Stability projects.

💵 USDP Jar Housekeeping

If this executive proposal passes, following the recommendation of the Governance Facilitators in collaboration with the spell team, the following operations will be performed:

• Raise PSM-PAX-A Debt Ceiling to 2,000 DAI.

• Call push(uint256 amt) on MCD_PSM_PAX_A_INPUT_CONDUIT_JAR with an amt of 1,159 USDP.

• Call void() on MCD_PSM_PAX_A_JAR.

• Set PSM-PAX-A Debt Ceiling to 0 DAI.

This will have the following net results:

• Debt Ceiling remains at 0 DAI after the transaction has been executed.

• Dai generated from PSM_PAX_A increases by 1,159 DAI.

• USDP balance of MCD_JOIN_PSM_PAX_A increases by 1,159 USDP.

• USDP balance of PSM_PAX_A_INPUT_CONDUIT_JAR decreases to 0 USDP.

• Surplus Buffer increases by 1,159 DAI.

💸 May 2024 Aligned Delegate Compensation

If this executive proposal passes, transfers for Aligned Delegate compensation will be made to qualifying Aligned Delegates, totaling 210.81 MKR.

💸 Q2 2024 AVC Member Participation Rewards

If this executive proposal passes, distributions totaling 100.08 MKR will be made for Q2 2024 AVC member compensation. This amount is pro-rated to two months due to recent amendments to The Atlas that removed the AVC Member role.

This executive proposal includes an office-hours modifier that means it can only be executed between 14:00 and 21:00 UTC, Monday - Friday.

MKR holders and delegates, now is the time to actively engage and shape the future direction of MakerDAO:

Vote directly through the Executive Proposal:

https://t.co/YRMNTkJv26

or

Delegate your MKR to one or more Recognized Delegates:

The latest Executive Vote has been approved by Maker Governance.

↓

https://t.co/uGCRHTjVOb

The following changes will be executed within the Maker Protocol on June 5th, at 21:36 UTC:

⚡ Trigger Spark Proxy Spell

A Spark proxy spell at 0x7bcDd1c8641F8a0Ef98572427FDdD8c26D642256 will trigger the following changes:

SparkLend Interest Rate Model Update

Ethereum

• ETH: Reduce slope 1 to 2.5%.

• USDC and USDT: Change slope 1 to DSR + 1% and reduce slope 2 to 15%.

These adjustments make borrowing rates for ETH, USDC, and USDT more competitive and efficient.

Gnosis Chain

• ETH: Reduce slope 1 to 2.5%, and reduce optimal utilization to 80%.

• DAI: Reduce slope 1 to 9%, reduce slope 2 to 15% and increase optimal utilization to 95%.

• USDC, USDT, and EURe: Reduce slope 1 to 9%, reduce slope 2 to 15%, and increase optimal utilization to 95%.

These interest rate changes enhance borrowing efficiency and utilization on Gnosis Chain.

Update Spark’s MetaMorpho Vault Supply Caps

• Increase the supply cap of the sUSDe 91.5% LLTV pool to 100 million DAI.

• Increase the supply cap of the sUSDe 86% LLTV pool to 400 million DAI.

These changes, driven by market trends and user demand, allow for more DAI to be supplied, potentially increasing liquidity.

Turn Off Siloed Borrowing for All Stablecoins

• Turn off siloed borrowing for USDC and USDT on both Ethereum and Gnosis.

• Turn off siloed borrowing for EURe on Gnosis.

Removing borrowing restrictions for these stablecoins simplifies borrowing across the platform.

Disable Governance Bridge Security Delay

The bridge security delay for SparkLend governance on Gnosis will be reduced from 2 days to 0 days to streamline operations.

🔥 Smart Burn Engine (SBE) Parameter Updates

• The vow.hump (SBE Surplus Buffer Upper Limit) parameter will be increased to 55 million DAI.

This parameter sets the threshold for the Smart Burn Engine (SBE) to initiate transactions. The change, recommended by BA Labs, will enhance system resilience and reduce risks.

🏦 Approve RWA Foundation (RWAF) DAO Resolution

• RWAF DAO Resolution with IPFS hash Qmb8vLDH6wT4Y2axnJX1JSKVKHTG3jzX3U3novw886H8UR.

The resolution instructs the Director of RWAF to start the process of finding and onboarding an appropriate banking partner for RWAF.

🏛️ Approve Harbor Trade Credit (RWA004-A) DAO Resolution

• RWA004-A DAO Resolution with IPFS hash QmUiYTRy4BkV681tfFe3Ksj6gdLEq27w34MqLw5LvRaBoD.

The resolution allows the DAO to support HTC's case against Snakebyte in Germany and cover the legal costs.

A new proposal to onboard Etherfi’s weETH into SparkLend is now open for voting in the Maker Governance Portal.

$weETH is the largest Liquid Restaking Token (LRT) on the market. It is also the only large LRT with fully enabled withdrawals, ensuring stable liquidity and a strong peg to ETH.

Phoenix Labs has proposed listing weETH to increase DAI borrowing on SparkLend, given the low competition for borrowing USD stablecoins using LRT collateral.

The initial parameters and risk assessment are based on current market and liquidity conditions for weETH:

• Loan to Value: 75%
• Liquidation Threshold: 73%
• Supply Cap: 5,000 weETH

If approved, this change will be part of an upcoming Executive Vote in SparkLend.

More initial parameters for weETH are detailed in the risk assessment: https://t.co/bCrGTE1wtG

Check the poll in the Maker Governance Portal ↓

May has been a strong month for MakerDAO and DAI.

The Maker ecosystem saw significant movements with the upcoming Launch Season and the latest updates around Maker products.

Here are the month's highlights ↓

• In May, Stability Fees for different Maker Vaults decreased, boosting the total DAI supply and keeping it above 5 billion DAI.

• The current Total Value Locked (TVL) in the Maker Protocol closed the month at approximately $8.91 billion.

• The ETH-C vault holds the most value in total-value locked, with around $2.04 billion worth of ETH locked.

• In addition to traditional vaults, the Spark and Morpho D3Ms have shown strong performance. The Spark D3M is generating approximately $75 million in estimated annual revenue, while the Morpho D3M brings in around $52 million. These two are the biggest revenue generators for the Maker Protocol.

• Meanwhile, the DSR slightly decreased to 8%. Despite this, nearly 2 billion DAI remains deposited. The largest deposit method is sDAI, with approximately 1.2 billion sDAI.

With Endgame approaching, the future looks promising. And this is just the beginning.

For complete data on MakerDAO metrics, visit:

The latest Executive Vote has just gone live on the Maker Governance portal.

🗳️ https://t.co/uGCRHTjVOb

MKR holders and delegates can use their voting power to deploy the changes listed below if they support them.

If this executive proposal passes, the following actions will occur within the Maker Protocol:

⚡ Trigger Spark Proxy Spell

A Spark proxy spell at 0x7bcDd1c8641F8a0Ef98572427FDdD8c26D642256 will be triggered. This includes changes that will adjust SparkLend’s risk parameters on Ethereum Mainnet and Gnosis Chain. The Spark’s MetaMorpho Vault allocation will also see increased supply caps.

[Mainnet+Gnosis] SparkLend Interest Rate Model Update

If this executive proposal passes, the following changes will be implemented on the SparkLend markets:

Ethereum

• ETH: Reduce slope 1 to 2.5%

• USDC and USDT: Change slope 1 to DSR + 1%, and reduce slope 2 to 15%

Gnosis

• ETH: Reduce slope 1 to 2.5%, and reduce optimal utilization to 80%

• DAI: Reduce slope 1 to 9%, reduce slope 2 to 15%, and increase optimal utilization to 95%

• USDC, USDT and EURe: Reduce slope 1 to 9%, reduce slope 2 to 15%, and increase optimal utilization to 95%

[Mainnet] Update Spark’s MetaMorpho Vault Supply Caps

To capitalize on Ethena's recent rate adjustments, the following changes on the Spark’s MetaMorpho Vault will take effect:

• Increase the supply cap of the sUSDe 91.5% LLTV pool to 100 million DAI.

• Increase the supply cap of the sUSDe 86% LLTV pool to 400 million DAI.

[Mainnet+Gnosis] Turn Off Siloed Borrowing for All Stablecoins

• Turn off siloed borrowing for USDC and USDT on both Ethereum and Gnosis.

• Turn off siloed borrowing for EURe on Gnosis.

[Gnosis] Disable Governance Bridge Security Delay

The bridge security delay for SparkLend governance on Gnosis will be reduced from 2 days to 0 days to streamline operations.

🔥 Smart Burn Engine (SBE) Parameter Updates

The Smart Burn Engine (SBE) parameter will be changed:

• The vow.hump (SBE Surplus Buffer Upper Limit) parameter will be increased to 55 million DAI.

This parameter sets the threshold for the Smart Burn Engine (SBE) to initiate transactions. The change, recommended by BA Labs, will enhance system resilience and reduce risks.

🏦 Approve RWA Foundation (RWAF) DAO Resolution

The following DAO Resolution about RWA Foundation (RWAF) will be approved:

• RWAF DAO Resolution with IPFS hash Qmb8vLDH6wT4Y2axnJX1JSKVKHTG3jzX3U3novw886H8UR.

The resolution instructs the Director of RWAF to start the process of finding and onboarding an appropriate banking partner for RWAF.

🏛️ Approve Harbor Trade Credit (RWA004-A) DAO Resolution

The following DAO Resolution pertaining to Harbor Trade Credit (RWA004-A) will be approved:

• RWA004-A DAO Resolution with IPFS hash QmUiYTRy4BkV681tfFe3Ksj6gdLEq27w34MqLw5LvRaBoD.

The resolution allows the DAO to support HTC's case against Snakebyte in Germany and cover the legal costs.

MKR holders and delegates now is the time to actively engage and shape the future direction of MakerDAO:

Vote directly through the Executive Proposal:

https://t.co/uGCRHTjVOb

or

Delegate your MKR to one or more Recognized Delegates:

Understanding Maker's Direct-Deposit Modules

Direct-Deposit Modules (D3Ms) are specialized pipelines that connect the Maker Protocol to various protocols needing liquidity and can provide outsourced yield on that liquidity.

D3Ms establish wholesale credit lines denominated in DAI, enabling these external protocols to access DAI directly from Maker. The borrowed DAI is then strategically deposited to enhance liquidity within targeted markets.

Currently, Maker has two active D3Ms: the Spark D3M and the Morpho D3M for the Spark MetaMorpho Vault. These D3Ms, powered by Maker, have a combined supply of approximately $1.2 billion — around $825 million to Spark and $400 million to Morpho.

These two D3Ms are top performers in annual fee generation for MakerDAO, with Spark generating approximately $70 million DAI and Morpho generating around $55 million DAI in annualized fees.

In essence, D3Ms enable the creation of new DAI, expanding the overall supply and influencing market dynamics. By strategically depositing borrowed DAI, D3Ms contribute to a more liquid and efficient DeFi ecosystem.

For live stats on the D3Ms and more in-depth information, visit MakerBurn:

Spark MetaMorpho DAI Vault Allocation Updated

An additional 50 million DAI has been allocated to the sUSDe/DAI 86% LLTV vault from the Spark MetaMorpho DAI Vault. This increases the vault's total debt exposure to 400 million DAI, enhancing the vault’s health and boosting annual income for the Maker Protocol.

Currently, the annual income from the Morpho DDM has surpassed $50 million, reaching approximately $52 million.

Inactive pools (94.5% and 77% LLTVs) have been reallocated until they reach at least 93% utilization. This will help concentrate usage into fewer pools and simplify the borrower experience.

Changes in Vault Allocations:

• USDe 77% LLTV allocation: 15,527,097 DAI (Reduction of 809,819 DAI)

• USDe 94.5% LLTV allocation: 8,843,231 DAI (Reduction of 470,704 DAI)

• sUSDe 77% LLTV allocation: 2,253,796 DAI (Reduction of 699,191 DAI)

• sUSDe 86% LLTV allocation: 134,183,115 DAI (Increase of 51,979,715 DAI)

Thanks to the @blockanalitica team, checking Maker’s analytics is easy on Makerburn.

On the Home page, you can get a quick look at Maker’s overall numbers, such as:

• Total supply of DAI
• Amount of DAI in the System Surplus
• Estimate of annual profits
• MKR price
• Progress of the MKR buyback
• Recent changes to the Maker Protocol
• TVL of the Maker Protocol
• Amount of DAI in the DSR
• Current price of DAI

Let’s take a quick overview of the rest of the site and the types of insights you can find ↓

An additional 50 million DAI has been allocated to the sUSDe/DAI 86% LLTV vault from the Spark MetaMorpho DAI Vault.

This update raises the Spark Morpho Direct-Deposit Module’s debt ceiling to a new all-time high of 450 million DAI.

Currently, this core vault engine contributes approximately $49 million in annualized income to the Maker Protocol.

As part of Maker's Endgame Plan, the Lockstake Engine will be introduced as a future initiative designed to significantly incentivize active participation in governance following the launch of the NewGovToken.

The Lockstake Engine will allow NewGovToken and MKR holders to lock their tokens and earn NewStable and SubDAO tokens. This forthcoming mechanism aims to foster long-term engagement and provide increased risk/reward exposure to the protocol's success. It is expected to launch following the rollout of the NewGovToken.

Discover its primary benefits and understand how it will generate additional engagement in governance participation. ↓

A new Executive Vote is live on the Maker Governance portal.

🗳️ https://t.co/2T1WqZsvsV

MKR holders and delegates can use their voting power to implement the changes listed below if they support them.

If this executive proposal passes, the following actions will be deployed within the Maker Protocol:

📊 Stability Scope Parameter Updates

As per the recommendation of the Stability Scope Advisory Council Member, BA Labs, the following Stability Fees will be changed:

• Decrease the ETH-A Stability Fee to 8.25%.

• Decrease the ETH-B Stability Fee to 8.75%.

• Decrease the ETH-C Stability Fee to 8.00%.

• Decrease the WSTETH-A Stability Fee to 9.25%.

• Decrease the WSTETH-B Stability Fee to 9.00%.

• Decrease the WBTC-A Stability Fee to 9.75%.

• Decrease the WBTC-B Stability Fee to 10.25%.

• Decrease the WBTC-C Stability Fee to 9.50%.

📊 Dai Savings Rate (DSR) Change

As per the recommendation of BA Labs, the following change to the DSR will be made:

• Decrease the DSR by 2 percentage points to 8.00%.

⚡ Spark Proxy Spell

A Spark Proxy Spell at 0x901E4450f01ae1A2615E384b9104888Cb9Cb02FF will be triggered. It includes the following change:

• Activate a new Dai Interest Rate Module to reduce the Spark Effective Dai Borrow Rate to 9%.

💸 Aligned Delegate Compensation for April 2024

The transfer detailed in the vote totalling 208.09 MKR for Aligned Delegate Compensation will be made to qualifying Aligned Delegates.

🗣️ Whistleblower Bounty

As a bounty for the information leading to the derecognition of AD TrueName, the following transfer will be made:

• Transfer 20.84 MKR to forum user Compacter at 0xbbd4bC3FE72691663c6ffE984Bcdb6C6E6b3a8Dd.

🤖 Keeper Network Job Update

The Keeper Network's D3MJob will be updated through the following contract calls:

• sequencer.removeJob(0x1Bb799509b0B039345f910dfFb71eEfAc7022323)

• sequencer.addJob(0x2Ea4aDE144485895B923466B4521F5ebC03a0AeF)

🏗️ Launch Project Funding

The following transfers will be made to the Launch Project at 0x3C5142F28567E6a0F172fd0BaaF1f2847f49D02F:

• Transfer 5,358,007 DAI to the Launch Project.

• Transfer 1,969.17 MKR to the Launch Project.

🐞 Bug Bounty Payout

The following transfers will be made as part of the Bug Bounty Program:

• Transfer 50,000 DAI to the bug reporter at 0xa24EC79bdF03bB325F36878573B13AedFEd0717f.

• Transfer 5,000 DAI to Immunefi at 0x7119f398b6C06095c6E8964C1f58e7C1BAa79E18.

MKR holders and delegates, now is the time to engage, vote, and shape the future direction of MakerDAO.

Vote directly through the Executive Proposal:
https://t.co/2T1WqZsvsV

or

Delegate your MKR to one or more Recognized Delegates:

As the launch season approaches, MakerDAO is preparing to introduce two new tokens - NewStable and NewGovToken. Explore the details below ↓

After the upcoming brand reveal, the new tokens will be introduced into the ecosystem. NewStable (NST) is the codename for the upgraded version of Dai, tailored for broader adoption and designed with enhanced stability features. The official name will be unveiled through the… https://t.co/IxQdu6Zetn