Governance Challenges in DAOs

Welcome to The Chopping Block! Crypto insiders Haseeb Qureshi, Tom Schmidt, and Robert Leshner chop it up about the latest news in the digital asset industry. In this episode, Hasu, the gourmand of governance and Rune Christensen, chief mischief maker at MKR, discuss how to manage a DAO, their respective visions for MakerDAO, and much more. 

Show topics:

• What MakerDAO is, how DAI works and whether it is the “central bank” of DeFi
• How the visions for MakerDAO of Hasu and Rune differ
• Whether Maker should only hold highly liquid collateral assets
• Hasu’s mental model of DAI as eurodollars
• The role of real-world assets in backing DAI
• What the purpose of a DAO is and how it differs from a legal entity
• Whether people behave in their purest form within a DAO
• How DAI can create positive externalities and make a better world
• How crypto holders are not only in it for the money but also for the philosophy 
• What the “decentralized stablecoin trilemma” is
• Whether there’s a need for dollar-denominated collateral for DAI to work
• What “clean money” is according to Rune
• Why Rune thinks having a single council is not viable due to the political risks and whether the solution is to have multiple councils
• How to keep the principal-agent problem in check, according to Hasu
• Why Hasu believes council members wouldn’t pursue their own interests and go against the benefit of MKR token holders
• Whether a council would be corruptible and the dangers that it entails
• What kind of interests should be represented in the council
• Whether Maker can create more synthetic assets
• The iron law bureaucracy and how it relates to governance
• How to design the DAO to be steered in alignment with the token holders
• Whether ossification is a feature to be pursued, and where innovation happens
• How complexity is very expensive for an organization

Hosts

• Haseeb Qureshi, managing partner at Dragonfly Capital
• https://twitter.com/hosseeb
• Tom Schmidt, general partner at Dragonfly Capital
• https://twitter.com/tomhschmidt
• Robert Leshner, founder of Compound 
• https://twitter.com/rleshner 

Hasu

• Twitter: https://twitter.com/hasufl

Rune Christensen

• Twitter: https://twitter.com/RuneKek

Episode Links

MakerDAO

• Hasu’s governance proposal: https://vote.makerdao.com/address/0xafaff1a605c373b43727136c995d21a7fcd08989#delegate-credentials
• Rune’s proposal - the endgame: https://forum.makerdao.com/t/the-endgame-plan-parts-1-2/15456
• Proposal to add a lending oversight core unit: https://forum.makerdao.com/t/mip39c2-sp33-adding-lending-oversight-core-unit-love-001/15098
• Previous Coverage of Unchained: 
• Rune Christensen of MakerDAO Part 1: How to Keep a Crypto-Collateralized Stablecoin Afloat: https://unchainedpodcast.com/rune-christensen-of-makerdao-part-1-how-to-keep-a-crypto-collateralized-stablecoin-afloat/
• Rune Christensen of MakerDAO Part 2: How Dai Stayed at $1 While ETH Crashed From $1,400 to $85: https://unchainedpodcast.com/rune-christensen-of-makerdao-part-2-how-dai-stayed-at-1-while-eth-crashed-from-1400-to-85/
• The Rise of MakerDAO: A Personal Journey:  https://unchainedpodcast.com/the-rise-of-makerdao-a-personal-journey/

Real World Assets:

• Huntingdon Valley Bank (“HVB”) proposal: https://forum.makerdao.com/t/huntingdon-valley-bank-hvb-rwa-collateral-onboarding-risk-assessment/15828
• $500 million allocation proposal: https://forum.makerdao.com/t/signal-request-asset-allocation-of-mip65-clydesdale/15922

The stablecoin trilemma: https://fluid.ch/stablecoin-trilemma/#:~:text=A%20deeper%20dive%20into%20the,decide%20on%20the%20stablecoin%20supply.

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