Ron Christensen, co-founder of Maker, the decentralized independent organization responsible for managing the DAI stablecoin, has spoken out against two competitors. He stated that UST, the Terra stablecoin pegged to the dollar, and MIM, another secured stablecoin, were a “hard currency” and that a bear market would eventually drive their prices to zero.
Maker co-founder summons competitors
Ron Christensen, co-founder of the organization behind the creation and development of DAI, a decentralized stablecoin, has named two competitors. Christensen shown That he was tired of being teased by UST and MIM “reply men” on Twitter, he indicated his opinion on these two relatively new stable operations, comparing them to DAI. Christensen advertiser:
Look, UST and MIM are solid pieces and I respect that. You can make good money from them for sure. But it is not designed for flexibility and will go to zero once the market becomes a reality.
Christensen explained by noting that DAI was built for resilience while noting that the project is the most reliable when it comes to smart contracts and additional security. However, UST DAI flipped as the most valuable stablecoin project back in December. However, DAI ranks second among decentralized stablecoin projects in terms of market capitalization.
While MIM, UST, and DAI are all decentralized stablecoins in name, each is designed differently. While DAI and MIM are collateralized stablecoins – meaning there are other assets that support their value in the event of a sale – floor treasuries are a pure algorithmic stablecoin, their peg being maintained through arbitrage incentives.
The criticism of these collateralized stablecoins came from the fact that some of the funds backing the assets consist of centralized stablecoins. In fact, according to the graph Submitted By Christensen, 37.4% of the DAI generated is guaranteed by USDC. However, Christensen notes that MIM has also encountered problems in this regard, hinting that it could gain a higher percentage of its support based on the centralized stablecoin.
The stablecoin segment has grown exponentially last year, with USDT, the largest stablecoin in the market, going from a market capitalization of $20 billion at the beginning of 2020, to nearly $80 billion starting in 2021. But decentralized alternatives have grown even more. , with UST multiplying its market value more than 50 times. In the same way, MIM has accessed a capital of $4.6 billion since its inception last September.
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