Pregame Constitution Seeks To Allocate 20,000 MKR To Scientific Sustainability Fund
Rune Christensen, the founder of MakerDAO and former CEO of the project’s now-dissolved foundation, is asking the protocol for $14M worth of MKR tokens to fight climate change.
On Feb. 1, Christensen published a draft of “The Maker Constitution” to the project’s governance forum. The document is described as a tool for aligning “the political and operational interactions and processes that occur in Maker Governance.”
The constitution includes commitments that the core objective of the Maker protocol is to maintain the stability of the DAI stablecoin, and that Maker Governance will act to prevent DAI tokens held in user accounts or decentralized smart contracts from seizure.
The document also asserts that “Scientific Sustainability” is a core principle for the project, stating that Maker “recognizes the unique relationship between financial infrastructure and the global environmental risks of climate change.”
As such, Christensen’s pregame constitution seeks to allocate 20,000 MKR tokens from the project’s treasury to a Scientific Sustainability Fund.
The fund is described as directing resources toward “awareness campaigns for promoting, educating and combating misinformation about energy solutions that have proven, real-life track records of achieving scalable decarbonization.”
Christensen adds that the Sustainability Fund is a temporary measure that will be wound down and replaced in the future.
But not everyone in the crypto community is convinced by Christensen’s proposal.
“If this gets approved, 20,000 MKR is gonna be sold? lol,” tweeted DegenSpartan, a popular crypto influencer.
“Thieves. Destroying value for MKR holders,” Yourfriendsommi said.
The constitution also calls for the creation of a standardized front-end application enabling MKR holders to participate in Maker governance and outlines processes surrounding governance delegation.
The draft constitution also reaffirms MakerDAO’s intent to generate new MKR tokens and auction them off to collateralize DAI should the stablecoin become undercollateralized in the future.
However, Christensen says it is not a “guaranteed commitment” and is contingent on Maker governance approving any future proposals relating to the dilution of MKR’s supply.
“This option needs to be available in case of unusual, serious losses where an attempt to cover the shortfall through the generation of MKR tokens would result in the MKR token becoming worthless and consequently forcing the Maker Protocol to shut down,” MakerDAO’s founder wrote.
DAI faced a crisis of under-collateralization after the Black Thursday crash in March 2020 that wiped out more than 50% of the value of most leading crypto assets in less than two days.
With prices crashing faster than the protocol could keep pace with, DAI became under-collateralized by about $4M, triggering the protocol’s first and only debt auction to date.
New MKR tokens were printed and auctioned off to bidders to recapitalize DAI, but MKR lost two-thirds of its value between March 8 and March 13.
Christensen has titled the document Maker’s “Pregame Constitution.” He said the constitution’s scope will expand when Maker implements its controversial “Endgame” roadmap.
The Endgame roadmap will establish multiple specialized subDAOs tasked with overseeing complex aspects of Maker’s operations, such as its increasing partnerships with legacy institutions dealing with real-world assets.
Maker intends to divest governance responsibilities pertaining to its complex operations, simplifying the governance processes for the core MakerDAO protocol at the same time.
“In all cases where it is possible, complexity, responsibility, decision-making authority and risk is pushed to the edges of the Maker Ecosystem, ensuring the core governance processes remain as simple as possible over time,” Christensen wrote.