Since the launch of the project, Makerdao has been a demanding project. The Maker project created one of the first decentralized stable coins known as DAI, which leverages overcollateralization and oracles to hold a peg.
DAI is used on exchanges in numerous applications such as compound and uniswap and is widely used in the defi world. The project has also seen a number of issues over the years and skeptics have questioned the integrity of the Makerdao protocol.
According to News.bitcoin.com a few examples include the stablecoin having issues holding its $1 peg, as there have been various votes held to address the issue. Then on March 12, 2020, otherwise known as ‘Black Thursday,’ the Maker project had major difficulties when the price of ETH crashed, as many Collateralized Debt Positions (CDP) were ravaged.
This caused the Maker project to get sued in a class action lawsuit, which is still ongoing. This week the crypto community has been complaining about Makerdao’s recent governance ballot, which saw the Bprotocol project sway a Maker governance vote.
Another vote is being taken to deal with this issue, so it won’t happen again including raising the amount of MKR needed to apply governance stake. A debate in the Maker Forum called “Updates – Flash loans and securing the Maker Protocol” was held between Makerdao ‘s Management Coordinator, “Longforwisdom” and other group representatives.
“As promised, I’m providing an update now [that] the current hat exceeded 100k MKR,” Longforwisdom wrote. “As mentioned previously, the contents of this spell are as follows:
- A GSM pause delay increase from 12 hours to 72 hours.
- The Oracle Freeze Module (OsmMom) will be deauthorized.
- The Liquidations Freeze Module / Circuit Breaker (FlipperMom) will be deauthorized.”
Also, crypto community members also wonder if other Ethereum-based defi governance protocols can be gamed by an uncollaterized flash loan.