Decentralized stablecoins could dominate crypto: MakerDAO founder

Decen­tral­ized sta­ble­coins may even­tu­al­ly dom­i­nate the sta­ble­coin mar­ket, so long as cryp­to “ends up liv­ing up to its poten­tial,” says Rune Chris­tensen, the co-founder of DeFi pio­neer MakerDAO.

Speak­ing to Cointelegraph’s Andrew Fen­ton at Token 2049 in Sin­ga­pore, Chris­tensen aired his thoughts on the future of decen­tral­ized sta­ble­coins such as Dai (DAI) and their role in the wider cryp­to economy.

They dis­cussed a pre­sen­ta­tion by Cas­tle Island Ven­tures part­ner Nic Carter at the TOKEN2049 con­fer­ence in Sin­ga­pore in which he said that inter­est-bear­ing sta­ble­coins could become 30% of the mar­ket with­in two years.

Chris­tensen agreed but said it would prob­a­bly depend on the macro sit­u­a­tion, adding “if high infla­tion high rates con­tin­ue, then prob­a­bly,” sta­ble­coin dom­i­nance will increase. 

When asked whether a decen­tral­ized sta­ble­coin could com­pete with its cen­tral­ized cousins, he replied:

“Eas­i­ly I mean, I think if the space ends up liv­ing up to its poten­tial, then decen­tral­ized sta­ble­coins will be the entire mar­ket like cen­tral­ized sta­ble­coins would be the edges that con­nect us to like the lega­cy system.”

He added that if cryp­to “deliv­ers” and becomes reg­u­lat­ed, cen­tral­ized sta­ble­coins will become more main­stream. How­ev­er, the real poten­tial is in decen­tral­ized sta­ble­coins, he suggested:

“I think the real killer advan­tage of decen­tral­ized sta­ble­coins, run by actu­al data like Mak­er, is this abil­i­ty to gam­i­fy your savings.”

Relat­ed: Mak­er­DAO pub­lish­es 5‑phase roadmap fea­tur­ing fund­ing for open-source AI projects

In mid-2022, Chris­tiansen pro­posed MakerDAO’s “Endgame Plan”. The plan pro­pos­es mak­ing DAI a free-float­ing asset, ini­tial­ly col­lat­er­al­ized by real-world assets (RWA).

There will be a three-year peri­od when DAI remains pegged to the dol­lar. Dur­ing this peri­od, the pro­to­col will dou­ble down on RWA to accu­mu­late as much Ether (ETH) as pos­si­ble which increas­es the ratio of decen­tral­ized collateral.

Rune believes that Mak­er has built a very sol­id and sta­ble foun­da­tion but it has been over­tak­en by scam­my and ille­git­i­mate projects. 

He wants to try and gam­i­fy to make the pro­to­col fun and more appeal­ing to younger users. “It’s what peo­ple want,” he said before adding, “Things are designed like a game and that’s the kind of inter­face they will use.”

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