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Published Apr 27, 2020

9 - Going Bankless with Maker | Mariano Conti

Mariano Conti delves into the empowering potential of cryptocurrencies like Dai against Argentina's economic challenges, highlighting Dai's role in DeFi innovations and decentralized governance within the Maker Protocol, while also addressing the delicate balance between decentralization and incorporating centralized assets.
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Episode Highlights

  • Programmable Money

    highlights the adaptability of Dai as a foundational element in decentralized finance (DeFi). He explains how Dai can be integrated with other protocols, creating innovative financial constructs like Chai, which combines Dai with the Dai Savings Rate, offering a seamless interest-earning mechanism 1. Mariano contrasts Dai with traditional US dollars in Argentina, emphasizing Dai's flexibility and ease of transfer without bureaucratic hurdles 2.

    This is programmable money guys. This is like we are installing mods on top of our money system and making it better.

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    This composability allows for endless possibilities, such as privacy-focused tokens and insurance-wrapped stablecoins.

       

    Unlocking Credit

    The Maker Protocol offers a decentralized credit system through its vaults, enabling users to mint Dai by locking up collateral like Ether. explains that this process is permissionless, allowing anyone with an Ethereum address to participate and create Dai, which can then be used across various DeFi protocols 3. He shares his personal transition from Bitcoin to Dai, illustrating how the Maker Protocol's credit mechanism facilitated his bankless journey 4.

    Every die that is in circulation is because somebody put in a valuable asset, in this case, most likely ether, and they over collateralized to mint this stablecoin die.

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    This system ensures that each Dai is backed by more value than it represents, maintaining stability and trust.

       

    Dai Savings Rate

    The Dai Savings Rate (DSR) offers a bankless savings option by allowing Dai holders to earn interest through a smart contract. describes how the DSR is funded by stability fees and liquidation penalties, providing a sustainable interest mechanism 5. This innovative feature enables users to benefit from surplus generated within the Maker system, enhancing the appeal of Dai as a stable and rewarding financial tool.

    The Dai savings rate which can be independent from whatever the system is actually making in surplus, it is really the system minting die out of thin air.

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    The DSR exemplifies the potential of decentralized finance to offer traditional banking services without intermediaries.

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