The statement of Rune Christensen, one of the founders of MakerDAO, about plans to sell 3.5 billion US dollars in exchange for Ethereum stirred up the community. The stable peg of DAI to the dollar is under threat.
If until recently everyone was discussing how the shock wave from the fall of Luna and Terra demolished stablecoins and related projects one by one, now all eyes are on Tornado Cash, which has fallen under sanctions, and is likely to cause no less damage to the crypto world.
Earlier we wrote about the problems of Tornado Cash, today we can see already their impact on other projects. In addition to us, the consequences of the sanctions imposed on Tornado Cash are also being monitored by MakerDAO, co-founder Rune Christensen.
“I have been doing more research into the consequences of the Tornado Cash sanction and, unfortunately, it is a lot more serious than I first thought.”
DAI is a decentralized stablecoin on Ethereum (ETH), which was launched in 2019. Its market capitalization at the time of writing is $7,017,564,220 USD according to CoinMarketCap .
However, since Black Thursday in 2021, DAI was predominantly backed by USDC. At the time it looked like a wise decision. Now, however, due to the Tornado Cash court case, some of the USDC (those that passed through Tornado Mixer), are technically worthless. Circle, their issuer openly said it won’t accept them and DAI smart contracts are not smart enough to distinguish between them.
The stable binding of the DAI stablecoin to the dollar is under threat, so Christensen wanted to convert $3.5 billion dollars into Ethereum. After his statement, price of the stablecoin fell by 4%, and after that, market capitalization also fell.
The idea of maintaining a stable binding has not been ignored. The founder of Ethereum, Vitalik Buterin, expressed his opinion on Twitter.
It is difficult to say what is in store for DAI, whether it will be able to keep its peg to the dollar and how Rune Christensen’s actions might really affect his work. But we will continue to observe and share new information with you as and when.