Maker co-founder calls UST and MIM will be zeroed out as “solid Ponzi schemes” – Bitcoin News


Rune Christensen, one of the founders of the decentralized autonomous organization Maker behind the governance of stablecoin DAI, publicly opposed the two competitors. He said that Terra’s USD-linked stablecoin UST and another collateralized stablecoin, MIM, are “solid Ponzi schemes” and the bear market will eventually lead to zero prices.

Maker co-founder summons competitors

Rune Christensen, one of the co-founders of the organization behind the creation and development of the decentralized stablecoin DAI, has summoned two competitors.Christensen Indicated Tired of being “replying people” on Twitter by UST and MIM, he expressed his views on these two relatively new stablecoins and compared them with DAI.Christensen statement:

Look, UST and MIM are reliable Ponzi schemes, and I respect this. You can definitely make a lot of money from them. But they are not built for flexibility. Once the market really changes, they will become zero.

Christensen elaborated that DAI is built for flexibility, and pointed out that the project is the most trustworthy in terms of smart contracts and mortgage security. However, UST Flip DAI became the most valuable stablecoin project in December. Nevertheless, in terms of market value, DAI ranks second among decentralized stablecoin projects.

Different designs

Although MIM, UST, and DAI are nominally decentralized stablecoins, each of them has a different design. Although DAI and MIM are secured stablecoins-which means that there are other assets to support their value in the event of a sell-off-UST is a purely algorithmic stablecoin whose linkage is maintained through arbitrage incentives.

The criticism of these collateralized stablecoins comes from the fact that some of the funds supporting the assets are made up of centralized stablecoins.In fact, according to a picture if Christensen proposed that 37.4% of DAI is collateralized with USDC. However, Christensen pointed out that MIM also has problems in this regard, implying that it may obtain a higher percentage of support based on centralized stablecoins.

Stablecoin sector growing up Large-scale last year, with USDTIt is the largest stablecoin on the market, with its market value increasing from US$20 billion in early 2020 to nearly US$80 billion in 2021. But decentralized alternatives have grown more, and UST has increased its market value by more than 50 times. Similarly, since its establishment in September last year, MIM has successfully achieved capitalization of US$4.6 billion.

What do you think of the Maker co-founder’s statement about UST and DAI? Tell us in the comments section below.

sergio@bitcoin.com'

Sergio Goshenko

Sergio is a cryptocurrency journalist based in Venezuela. He described himself late and entered the crypto space when prices rose in December 2017. With a background in computer engineering, living in Venezuela, and being affected by the cryptocurrency boom at the social level, he offers a different perspective on the success of cryptography and how it can help people without bank accounts and underserved people.

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