Investment Analysis: MakerDAO


Maker Infrastructure

Maker DAO, Dai and Ethereum

Solves distributed consensus (BFT) and secures the blockchain

Ether token acts as collateral for a CDP

Ether token is spent in order to interact with contracts and move funds

Ethereum platform allows other tokens to potentially interact with Maker/Dai

Governance token allows user to vote on system settings

MKR can act as a fund raising mechanism for the Maker team

Token is burned as part of the fee for settling a CDP

MKR token acts as a lender of last resort in the event of insolvency in Dai

Stable Coin pegged to the USD, that can be traded on any exchange

Token that is instantiated by users in the form of a CDP

Token required to pay-off the debt in a CDP, in order to reclaim Ether

Token used to bite undercollateralized CDPs by third parties

Maker/Ether/Dai User Interface

User Interface Images

Maker Valuation Metrics

CDPs — Creating New Dai

Closing a CDP — Burning MKR

Modeling MKR to Circulating Dai


Attack Vectors and Investment Risks

Current Type II Competitors to the Dai (BitShares)

Future Type II Competitors to the Dai

Future Type I & III Competitors to the Dai

Adoption Ceiling

Dai Collapse, MakerDAO Governance Failure

Weaknesses in the Ethereum Infrastructure


Contentious forks

New Generation of Blockchains Overtake Ethereum

Scalability Issues

Concluding Thoughts & Future Projections



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