We’re very happy to present and share the first investment review. Ever since the launch of this company we’ve had the ambition to contribute to the development of Decentralized Finance in multiple ways. Allowing investors and interested parties entry into this exciting and vibrant ecosystem is just one way of accomplishing this goal. Another way is to gather data, create knowledge and share it. This MakerDAO investment review will be the first of a series of investment reviews which we will be sharing with you throughout the year.
We hope it will help anyone looking for in-depth information about a possible investment or contemplating extensive use of a DeFi use case or additional educational material.
Distinguishing itself from the plethora of fiat-backed stablecoins on the market today, Makers crypto-backed stablecoin DAI is the first of its kind. The main benefit from this is that the entire Maker system can live and execute on the Ethereum Blockchain, without the need for intermediaries.
Because the Maker protocol is completely on-chain, it allows for a fully decentralized and trustless network. In comparison with fiat-backed stablecoins, trust in a custodian and it’s dollar reserves is unnecessary. All the price stability mechanisms for DAI are baked into the protocol using incentives for the actors in the ecosystem. A decentralized finance service true to its name.
This review is guided by many of the same principles we use to determine a protocol or project for investment. Our digital asset framework relies on many classic due diligence frameworks. We added many elements unique to blockchain technology and crypto/token-economics.
But the most important question is: is this project an addition to a global, decentralized financial system? Take your time and find the answers yourself.
If you wish to learn more about how to use MakerDAO we have also made a video that will guide you through all the steps to get your first loan. At the same time, you will get familiar with all the basic concepts like stability fees, collateral types, and liquidation rates.
This is how we DeFi.