MakerDAO founder Rune Christensen has confirmed that MakerDAO will launch Phase 1 of the “Endgame” plan in summer 2024.
Phase 1 of MakerDAO's Endgame will lay the foundation for structural reforms of the Decentralized Autonomous Organization (DAO) through the introduction of the new tokens.
MakerDAO Evolution: New tokens
The new tokens, codenamed NewStable and NewGovToken, offer users expanded opportunities to participate and invest within the ecosystem. They are the second stage in MakerDAO's plan, which begins with the unveiling of the brand and ends with improved deployment and yield opportunities for agriculture.
MakerDAO has seen success with its MKR governance token and its DAI stablecoin. The price of DAI remains at $1 through a mechanism that adjusts the fee for borrowing DAI based on the number of tokens in circulation. Users must deposit a certain amount of ETH in a Maker Vault to receive the number of tokens determined by the stabilization algorithm.
In the endgame scenario, DAI will serve crypto-native use cases, while NewStable targets broader mass adoption scenarios. The Lockstake Engine (LSE) will expand the protocol's governance mechanisms and encourage participation in the ecosystem through crypto staking. And a new low-cost bridge will improve blockchain interoperability.
Read more: Dai (DAI) Cryptocurrency: A Guide for Beginners
Total value locked in MakerDAO. Source: DeFi Llama
Following the launch of Spark Lend, MakerDAO will also launch SparkDAO, a so-called SubDAO that aims to achieve real-world assets and perpetual swap yields. The development of SubDAOs will improve MakerDAO's scaling amid anticipation of a new Layer 1 blockchain.
SubDAOs will also enable sustainable yield farming opportunities and improved user engagement through its tokenomics.
The highs and lows of Endgame
After years of preparation in the areas of technology, legal frameworks and community building, the MakerDAO community approved the endgame plan via blockchain vote in August 2022. Phase 1 will usher in structural reform, approximately ten years after Christensen conceived MakerDAO.
Maker's DAI stablecoin was among the first algorithmic stablecoin variants to maintain its US dollar peg through financial engineering. However, the project has been threatened by the broader crypto markets.
Users must deposit ETH to receive DAI as a loan without a fixed term. Still, an unfavorable market that drives down the price of ETH can cause DAI loans to become undercollateralized and trigger a wave of liquidations, as happened in 2020.
Liquidations totaled approximately $5.7 million as of March 16, 2020, highlighting the need for better crisis management. MakerDAO did not point out how the new governance tokens can overcome previous failures in its Endgame launch post, but Christensen emphasized the need to move forward quickly in the bull market.
“It will be necessary to make some changes to the bootstrapping fast track process as we navigate not only launch preparations, but also the ongoing bull market that requires a faster pace of action,” Christensen wrote.
Read more: Maker (MKR) price prediction 2023/2025/2030
After the endgame proposal was passed, MakerDAO’s Sébastien Derivaux questioned the objectivity of the MakerDAO endgame vote. He claimed that Christensen influenced 60% of the voting addresses.
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