MakerDAO, the largest decentralized stablecoin project, plans to launch its own stand-alone blockchain by potentially forking Solana. This decision, however, is meeting a mixed response from the crypto community.
The ever-evolving world of decentralized finance is no stranger to strategic pivots, but MakerDAO now finds itself at the center of recent discussion.
As previously reported, MakerDAO is currently undergoing an upgrade of its governance structure. According to the project’s founder Rune Christensen, the goal of this update is to improve the security of governance, and the adoption of the DAI stablecoin.
This upgrade comprises five stages, with the fifth and final one planned to introduce MakerDAO’s own stand-alone blockchain named NewChain. The team believes that NewChain will allow the ecosystem to use hard forks for recovery from severe governance attacks and address eight years of technical debt in the protocol.
The fifth phase is a long-term process that could take over three years to complete. However, the team is already exploring options for NewChain based on existing technology and is seriously considering a potential fork of Solana.
The team believes that Solana has the most promising codebase in the space. Solana's blockchain is designed for high efficiency, and its ecosystem has shown strength, even after big events like the FTX blowup. Furthermore, there are already instances where the Solana codebase has been successfully forked, and adopted to act as appchains.
While the move to a Solana fork and the protocol upgrade have garnered attention, not everyone is enthusiastic. Many users have criticized the new strategy, with some questioning the necessity of transitioning to a potentially less secure chain. Others have raised concerns about Solana's codebase, suggesting rollups as a preferable alternative.
It's interesting to note that right after the announcement, Ethereum co-founder Vitalik Buterin sold approximately $580,000 worth of his MKR tokens. Buterin commented that, “MakerDAO is torpedoing itself in weird directions”.
Currently, MakerDAO's DAI stablecoin ranks third in U.S. dollar stablecoin trading volume with a market capitalization of $3.85 billion. It sits well behind USDT and USDC and its share of the total stablecoin market cap remains relatively low at around 4%.
However, since the collapse of Terra, it is the only decentralized stablecoin still in the premier league. It remains uncertain whether this new direction will boost the adoption of DAI. We will continue to Observe the situation.