License: 
Creative Commons Attribution 4.0 International license (CC BY 4.0)
When quoting this document, please refer to the following
DOI: 10.4230/OASIcs.Tokenomics.2021.11
URN: urn:nbn:de:0030-drops-159082
URL: http://dagstuhl.sunsite.rwth-aachen.de/volltexte/2022/15908/
Kozhan, Roman ;
Viswanath-Natraj, Ganesh
Fundamentals of the MakerDAO Governance Token
Abstract
We study the fundamentals governing the price of the MakerDAO governance token MKR. Governance tokens are minted in response to liquidations, and burned in response to growth in the system surplus. MKR tokens appreciate with an increase in system surplus and depreciate with a rise in systemic risk due to DAI liquidation spirals. We discuss incentive compatibility conditions that need to be satisfied for the protocol to maintain the DAI stablecoin peg.
BibTeX - Entry
@InProceedings{kozhan_et_al:OASIcs.Tokenomics.2021.11,
author = {Kozhan, Roman and Viswanath-Natraj, Ganesh},
title = {{Fundamentals of the MakerDAO Governance Token}},
booktitle = {3rd International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2021)},
pages = {11:1--11:5},
series = {Open Access Series in Informatics (OASIcs)},
ISBN = {978-3-95977-220-4},
ISSN = {2190-6807},
year = {2022},
volume = {97},
editor = {Gramoli, Vincent and Halaburda, Hanna and Pass, Rafael},
publisher = {Schloss Dagstuhl -- Leibniz-Zentrum f{\"u}r Informatik},
address = {Dagstuhl, Germany},
URL = {https://drops.dagstuhl.de/opus/volltexte/2022/15908},
URN = {urn:nbn:de:0030-drops-159082},
doi = {10.4230/OASIcs.Tokenomics.2021.11},
annote = {Keywords: Cryptocurrency, monetary policy, stablecoins, governance token}
}
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Keywords: |
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Cryptocurrency, monetary policy, stablecoins, governance token |
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Collection: |
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3rd International Conference on Blockchain Economics, Security and Protocols (Tokenomics 2021) |
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Issue Date: |
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2022 |
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Date of publication: |
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18.03.2022 |
