MakerDAO Governance & Risk Call: Dai trades above peg as leveraged traders take profit

Quick Take

  • For the first time in 2019, Dai is trading above its target peg: the weighted average price currently sits at just over $1.01, although 14.6% of Thursday’s trades were filled between $1.03-$1.08
  • While Dai’s price activity is cause for temporary celebration and, to some extent, a sign that both on-chain governance and monetary policy can be used effectively, MKR stakeholders must remain vigilant: short-term reactionary changes to rates will not serve the system well

Participants on this week’s call exuded a palpable sense of relief as, after months of turbulence, Dai finally rallied beyond its target peg. Yet while this achievement warrants some short-term celebration, MakerDAO stakeholders would be remiss to consider their job done: as the crypto markets continue to trend upwards Dai will likely see sustained sell pressure.