►
Description
## Introduction
@LongForWisdom: Hosting, Introduction, Agenda.
## Topic
Emergency Governance Response to the recent increase in Dai price and continued pressure on the peg.
The call summary will be posted here:
https://forum.makerdao.com/t/emergency-peg-management-governance-and-risk-meeting-wednesday-july-29-6-00-pm-utc/3446
A
So
there's
only
really
one
topic
on
the
agenda,
which
is
that
one
we've
got
cyrus
here:
who's
the
ratified
risk
team,
he's
gonna,
discuss
some
of
the
issues
and
the
possible
well
the
response,
the
planned
responses
and
then
kind
of
open
it
up
to
discussion
and
ideas
and
comments.
I
guess:
does
it
feel
like
enough
of
introduction
science?
Do
you
want
to
join
us
yeah.
B
Sure
I
guess
I'm
just
going
to
kind
of
give
a
brief
overview
of
this
situation.
Just
kind
of
set
some
context,
maybe
throw
out,
like
kind
of
a
few
of
the
different
options
that
that
governance
could
consider
and
then
just
basically
start
up
a
discussion
from
the
community
on
the
direction
that
they
would
like
to
go
forward
and
okay,
so
the
dye
peg
has
been
showing
a
little
bit
of
additional
strength.
The
last
few
days
trading
up
around
103.
Briefly
up
to
104..
B
That
relief
was
obviously
very
short-lived.
In
the
past
three
four
days,
we've
seen
the
introduction
of
new
farming
opportunities.
We've
seen
compound
die,
die
amounts
hit,
new
all-time
highs,
we've
seen
a
waifu
fork
by
the
for.
For
those
that
aren't
aware,
I
mean
that
when
I
say
wife,
I'm
referring
to
the
wi-fi
or
wifey
or
iffy,
I'm
not
entirely
sure
what
the
pronunciation
is.
B
B
Over
the
past
several
weeks,
we've
seen
a
series
of
debt
ceiling
increases
each
one
slightly
larger
in
magnitude
than
the
previous
one.
So,
just
a
few
days
ago,
we
had
a
executive
vote
that
increased
debt
ceilings
by
an
additional
80
million
and
it
got
swallowed
up
in
basically
less
than
48
hours.
So
obviously,
in
the
past
month
or
so,
this
community
has
discussed
a
lot
about
kind
of
the
commitment
to
the
peg
the
commitment
to
defending
the
peg
through
increases
in
debt
ceilings.
B
I
think
we
may
have
reached
a
point
where
we
may
want
to
consider
significantly
more
aggressive
debt
ceiling
increases
one
to
lower
or
minimize
the
amount
of
friction
being
put
on
governance
with
essentially
a
vote.
Every
two
or
three
days,
also
just
kind
of
creating
as
much
liquidity
as
possible
as
quickly
as
possible,
given
just
given
the
kind
of
the
general
chaos
in
the
in
in
the
crypto
markets
these
days.
So
certainly
one
one
topic
of
discussion.
B
I'd
like
to
get
input
on
is:
should
we
should
we
start
considering
quite
large
debt
ceiling
increases
for
eth,
usdca,
usdcb
and
rap
bitcoin.
You
know
numbers
north
of
50
million
and
I
think
that's
kind
of
one
of
the
primary
context,
for
this
call
is
that
we're
reaching
we're
reaching
numbers
that
really
require
some
some
greater
levels
of
community
input.
B
B
C
B
B
D
B
C
C
D
A
Yeah,
this
is
something
like
well
something
I've
kind
of
shared,
apparently
like
it
kind
of
feels
like
the
genie's
out
of
the
bottle
in
terms
of
the
whole
liquidity
farming
thing
and
that
people
are
gonna
still
like.
Since
it's
been
such
a
successful
people
are
gonna.
Try
to
replicate
that
success
right.
E
Yeah
it's
so
I
made
this
argument
a
couple
times.
I
don't
think
we
should
be
prioritizing
like
compensation
for
collateral
risk
because
there's
a
much
bigger
risk,
which
is
their
protocol
as
a
whole
and
sort
of
ensuring
that
the
peg
stays
at
one
dollar,
like
that's
the
core
product,
and
we
should
be
defending
that
at
all
cost
and
not
worrying
so
much
about
recouping
you
know
four
percent
or
whatever,
on
collateral
risk,
especially
at
this
stage.
E
Well,
maybe,
while
we're
waiting,
I
would
like
to
promote,
I
I
put
up
a
thread
encouraging.
We
look
at
lowering
the
base
rate
to
do
exactly
what
I
was
saying.
You
know
spur
on
some
die
growth
like
supply
growth
and
get
those
stability
fees
down
for
usdca
and
maybe
even
the
kyber
network,
one
as
well.
C
E
Yeah,
I'm
proposing
we
go
to
a
negative
base
rate,
but
negative
base
rate
to
be
clear
does
not
imply
a
negative
stability
fee.
The
stability
fee
has
a
lower
bound
of
zero
percent
for
all
collateral
types,
so
going
to
say
negative
four
percent
base
rate
ife
would
still
remain
at
zero
percent,
but
usdca
would
go
to
zero
percent
stability
fee
as.
C
A
F
G
A
B
D
B
What
is
it
an
extra
two
million
to
that?
Is
it
it's
just
inconsequential
right?
If,
if
we
can
kind
of
get
some
consensus
that
it
should
be
included,
that's
it's
totally
fine
right,
but
we're
not
discussing
adding
50
million
to
bat,
for
example.
So
no
there's,
no
there's
no
real
reason
against
it
other
than
it's
just
a
little
bit
easier
to
reason
about
eth
and
usdc
debt
ceiling
increases.
G
It
doesn't
matter,
a
million
die
and
use
that
used
to
use
million
usdc,
lock
it
up
as
collateral,
but
be
able
to
leverage
themselves
up
significantly
to
go
from
one
position
to
the
other
to
arc
it
over
and
to
me,
if
we're
going
to
increase
the
dc,
the
debt
ceiling
to
the
numbers
we're
talking
about,
there
aren't
going
to
be
5
000
market
makers.
That
would
take
advantage
of
that
they'll
be
10
20,
but
we
should
give
them
as
much
leverage
as
possible
to
do
that.
Type
of
trade.
B
G
G
The
question
is:
how
do
we
get
to
that
number
right
and
if
five
people,
if
it
really
depends
on
the
severity
of
how
critical
this
issue
is,
and
that's
a
community
question,
it's
not
me
saying
it
is
or
isn't
it's
more
of.
If
we
lowered
it,
I
don't
even
know
what
it
is
today.
Is
it
110
or
105.?
It
was
120.
I
believe
it's
currently
done.
G
G
G
F
So
so
that's
actually
the
issue
right.
You
don't
want
to
forever.
Have
that
collateral
type
be
locked
at
one.
You
don't
want
to
forever
have
liquidations
turned
off
for
something
that
is
such
as
100
agreed
and
in
100
percent,
and
in
order
to
give
us
room
to
turn
on
liquidations
later,
you
can't
have
the
liquidation
ratio
be
too
low
unless
we
have
a
zero
percent
stability
fee,
but
yeah
unless
you
do
zero
percent
stability
fee,
but
then
that's
even
more
risk
for
the
system
right
right.
That's
that's!
Actually
the
trade-off
right.
G
A
B
Yeah
I
mean,
I
think,
just
the
the
main
counterpoint
to
to
matthew's
argument
is
that
we
just
saw
like
an
insta
40
million
usdc
debt
ceiling
fill
up
just
from
two
days
ago,
like
so
so
matthew.
The
drop
from
120
to
110,
collateralization
ratio
just
happened
on
monday
and
the
this
die
supply.
There
was
kind
of
like
plateaued
at
40
million
for
last
few
weeks,
and
then
it
just
instantly
got
filled
up
recently.
B
Yeah
I
mean
I,
I
sort
of
lost
my
train
of
thought
from
when
I
got
disconnected,
but
essentially
I
think
the
community
is
starting
to
kind
of
recognize
that
larger
and
larger
debt
ceilings
are
necessary
in
the
absence
of
any
alternative
solutions.
Ideas
surrounding
kind
of
the
demand
side
essentially
got
sidebarred
for
now.
Things
such
as
things
such
as
a
trfm
kind
of
special
protocol,
consideration
or
special
protocol
vault
types,
also
temporarily
sidebarred.
B
So
at
least
as
far
as
I
can
tell
kind
of
that,
the
range
of
available
options
is
quite
limited
to
just
increases
in
debt
ceilings,
and
I
think
I
think
the
community
is
starting
to
realize
that
the
numbers
we
need
to
start
considering
are
significantly
higher
than
we
had
hoped,
or
maybe
some
people
kind
of
view,
this
as
a
good
thing
in
a
roundabout
way,
but
to
minimize
governance,
friction
and
and
kind
of
put
a
more
aggressive
stance
out
there.
I
think
I
think
we
can
start
discussing.
B
Significantly
larger
debt
ceiling,
so
I'd
like
to
kind
of
hear
some
input
on
that
on
potential
numbers
on
the
potential
tail
risks
on
the
you
know.
Obviously,
this
increases
an
enormous
amount
of
tail
risk
for
maker
down
huge
eth
collateral
in
the
system.
Huge
usdc
cloud
on
the
system,
we're
all
familiar,
that
eth
creates
significant
liquidation
issues
in
a
market
crash
and,
of
course,
usdc
has
some
kind
of
centralization
concern
there.
B
C
You
know
that,
even
with
with
the
amount
of
dye
that
would
have
to
be
liquidated
back
then,
which
is
you
know
clearly
smaller
than
how
much
we'd
have
to
liquidate.
If
that
sort
of
scenario
repeated
itself
today,
with
more
dye
outstanding,
we
could
have
real
problems,
but
just
to
just
to
make
a
a
point
actually
in
favor
of
increasing
debt
ceilings
right
now.
C
So
you
know
if
we
were
in
a
situation
where
each
was
being
really
bullish
and
people
were
were
were,
were
you
know,
selling
a
lot
of
diet
and
we
had
to.
We
were
thinking
about
increasing
the
debt
ceiling.
I
think
there's
a
risk
there
that
you
know
we're
feeling
expected
of
bubble
and
then,
when
this
bubble
bursts
we'll
have
you
know,
you
know
cascades,
liquidations
and
and
we'll
probably
take
up,
take
a
loss
there,
we're
not
in
that
sort
of.
C
We
don't
seem
to
be
in
that
sort
of
situation.
Right
now,
and
I
mean
there's
a
couple
of
specific
reasons
which,
firstly,
is
that
you
know
the
clash
classes
that
we're
using
don't
really
seem
to
be
in
a
speculative
bubble,
that's
driven
by
dye
issuance,
so
this
dye
issuance
is
not
actually
being
used
to
to
purchase
to
purchase.
You
know
the
clash
classes
that
we're
exposed
to
so
it
doesn't
seem
like,
like
people
are,
actually
you
know,
selling
their
diet
to
buy
youth,
for
example,
or
some
of
our
other
assets.
C
People
are
using
this
diet
to
farm,
which
means
that
the
cdp
users
are
not
actually
exposed
to
price
risk.
Me
in
the
collateral
assets
and
if
they
were,
if
their
positions
were
to
become
risky,
it's
more
likely
that
they'll
be
able
to
avoid
liquidation
by
simply
withdrawing
from
these
farms.
Hopefully,
like
nothing,
gets
nothing
gets
hacked
or
nothing.
Nothing
breaks
like
that.
They
should
be,
that
should
be
liquid
right
and
they
should
be
able
to
prevent
liquidation.
C
Unlike
you
know,
unlike
a
bunch
of
borrowers
who
are
exposed
to
the
collateral
assets
who
who
can
end
up
getting
liquidated
like
on
black
thursday.
So
I
just
wanted
to
say
that
it's
worth
watching
this
behavior
and
that
there's
a
big
difference
between
what's
going
on
now
and
kind
of
a
typical
speculative
bubble.
So
I
think
the
speculative
bubble
that
we're
seeing
now
is
probably
you
know
in
these
assets
like
comp
and
waifu
and
waifu
too,
and
so
on,
which
thankfully
we're
not
exposed
to,
or
hopefully
we're
not
exposed
to.
C
So
if
those
assets
were
to
fail
we're
not
on
the
hook
for
it-
and
hopefully
you
know
as
long
as
those
as
those
yield
products
are,
are
liquid,
the
chances
of
people
getting
liquidated
are
lower
than
than
they
are
in
a
sort
of
typical
bull
market
where
everyone
is
borrowing
to
buy
more
right.
I
don't.
I
don't
think
that
means
that
there's
actually
no
chance
of
liquidation
and
there's
you
can
imagine
different
scenarios
where
this
could
go
wrong.
H
There's
a
question
to
be
had
here
whether
you
know
facilitating
massive
amounts
of
minting
to
dump
into
farming
opportunities
is
not
a
different
kind
of
bubble
and
that's
entirely
dependent
on
whether
there's
going
to
whether
you're
going
to
be
able
to
bank
on
lasting
demand
for
those
farming
opportunities
and
have
that
remain
relatively
steady,
because
if
tomorrow,
all
these
farming
opportunities
went
away,
then
yeah,
you
would
see
you
know
massive
flood
of
the
supply
back
on
the
market.
So
that's
that's.
A
question
to
be
had
is
whether
you
think
this
is
a
stable,
continuing
trend.
C
Oh
so
yeah,
so,
just
to
I
completely
agree
and
just
to
clarify
my
point,
I
I
didn't
mean
to
say
at
all
that
this
is
not
a
speculative
bubble
and
everything
is
great,
and
this
all
makes
a
lot
of
sense.
My
point
is
that
it's
not
a
speculative
bubble
in
the
collateral
assets,
so
this
is
increasing
our
you
know.
Increasing
debt
ceiling
is
not
increasing
our
risk
in
those
collateral
assets
as
much
as
it
would
be
if
we
were
actually
financing
a
speculative
bubble.
C
The
good
news
is
that
that
actually
would
be
a
supply,
a
flood
of
supply,
which
means
it
would
be
going
in
the
opposite
direction,
to
what
we're
having
now
so,
hopefully
we'll
be
able
to
to
unwind
it
right
like,
in
contrast
to
you,
know
a
speculative
bubble
in
the
collateral
assets
which
would
actually
create
upward
pressure,
which
would
be
you
know,
make
it
even
worse.
So.
H
C
Yep
exactly
so,
I
think
we
should.
We
should
kind
of
think
about
that
scenario
like
what,
if
it
all
ends
tomorrow,
how
will
how
will
things,
how
old
things
do
like
how
things
unwind?
What
could
fail?
Another
scenario
to
consider-
and
this
one
is
quite
scary-
is
like
one
of
which,
what,
if
one
of
these
like
janky
yield
farming
contracts
actually
traps
all
the
dye
in
inside
of
it.
C
H
Yeah
I
mean
just
to
to
put
in
context,
you
know,
just
with
the
wi-fi
primary
pools,
ending
that
kind
of
coincided
with.
Obviously
you
know
there's
potential
for
multiple
explanations,
but
that
coincided
with
you
know
at
least
a
three
cent
price
swing
on
die
downward.
So
you
know
if
everything
else
ended
tomorrow,
who
knows
how
big
that
swing
would
be.
A
F
So
when
we're
talking
about
increasing
the
debt
ceiling
by
a
large
amount
for
say
ethereum
do
we
mean
raising
it
so
much
that
we
are
subject
to
the
risk,
like
price
volatility
risk
where
I
don't.
I
don't
know
what
we
call
that
risk,
but
where,
if
ethereum
falls
by
30,
then
people
can
just
mint
free
die
basically
and
abandon
their.
B
C
I
was
wondering
if
anyone
here
or
potentially,
because
he's
here
has
a
view
on
like
this.
This
diamond
thing-
that's
you
know
that's
coming
from
from
yield
farming
like
how
how
precarious
does
it
seem
to
be
like?
Are
people
being
responsible
like
what
sort
of
what
sort
of
collateral
ratios
are
they
are
they
using
and
like
what
is
the?
What
are
the
likely
risks
for
them?
Getting
I'm
getting
liquidated
or
delivered.
H
So
yeah-
and
I
talked
about
this
last
week
and
I'll
touch
on
it
tomorrow
as
well,
but
andrew
says
nobody's
being
responsible,
I
mean
so
I
I
wouldn't
say
it's
quite
like
that.
But
when
we
looked
at
the
collateral
ratios
last
week
we
were
basically
seeing
very
an
increased
amount
of
debt
at
the
very
low
collateral
ratios.
H
There
is
also
an
increased
amount
of
debt
at
higher
collateral
ratios,
but
outpaced
by
the
amount
of
riskier
positions
that
were
being
taken
and
then
the
eth
price
surged
and
that's
the
thing
we
always
need
to
keep
in
mind.
Is
we
look
at
collateral
ratio?
Collateral
ratio
isn't
to
some
extent
priced.
You
know
on
eth
and
we
look
at
the
nominal
amount
of
eth
that
was
in
there
that's
actually
comparatively
pretty
risky.
H
So
what
you
got
to
really
be
worried
about
is
things
stay
the
same
or
risk
profiles
you
know,
get
riskier
and
then
eat
price
comes
back
down.
That's
when
you
really
get
screwed
and
yeah
there's
a
potential
for
very
large
quantities
of
dye
to
be
liquidated
in
the
event
that
that
happened.
There
were
like
two
big
walls
that
I
remember
tweeting
about
last
week
and
basically
or
earlier
this
week,
and
that
was
that
added
up
to
about
77
million
die
at
like.
H
H
Right
well,
that
has
a
bounce,
but
I
mean
that's.
That's
an
important
point
to
consider,
and
the
other
thing
that
I
touched
on
prior
was
the
the
amount
of
debt
that's
been
minted
like
we
have
to
really
ask
ourselves
anytime.
Something
goes
up
like
what's
the
likelihood
of
it
coming
down,
or
is
it
a
continuing
trend
right?
So
each
price
is
one
thing.
The
other
is
the
the
debt
supply,
and
so,
if
we
look
at
the
debt
minted
from
eth
in
particular,
that
had
exploded
in
the
last
few
weeks.
D
H
I
hadn't
looked
specifically
at
wbtc,
and
I
haven't
looked
in
depth
at
like
because
it's
a
little
bit
hard
to
track
with
all
the
new
stuff
going
on
lately,
where
that
dye
is
going.
But
it's
the
general
sense
that
for
ustc
and
eath,
a
lot
of
the
diet,
that's
being
minted,
is
going
into
yield
farming
opportunities.
H
D
B
All
right
well,
anyways,
it's
it's!
Obviously
the
40
million
is
is
getting
taken
quite
fast,
so
I
mean
every
every
exec
boat
has
been
larger
than
the
last,
and
you
know
now.
I
think
the
the
east
increase
should
be
somewhere
in
the
range
of
80
to
100
and
then
maybe
usdc
could
also
be
I'm
just
maybe
another
50
million
kind
of
that.
That
order
of
magnitude.
B
Right,
I
think
usdcp
could
also
use
an
increase
for
in
case
of
emergency
liquidity
for
keepers,
and
I
think
rap
bitcoin
also
got
kind
of
approved
on
a
forum
poll
to
have
an
increase.
So
we
could
kind
of
pull
that
forward
a
little
bit
and
maybe
even
just
increase
it
and
round
up
to
to
an
even
20
million
there.
B
A
B
How
do
we
feel
about
the
kind
of
the
the
overhead
on
voting
for
governance,
because
one
thing
we
could
do
is
is
do
kind
of
a
the
normal.
You
know,
you
know,
do
an
80
to
100
million
increase,
but
then,
if
it
gets
hit,
we
can
just
put
up
another
executive
vote
immediately
without
having
to
resort
to
another
expedited
governance,
call
and
polls
and
whatnot,
and
so
basically
break
it
up
into
chunks.
But
then
we
would
just
have
to
do
an
additional
executive
work.
B
A
Yeah
I
mean,
as
you
said,
we
have.
We
have
done
that
previously,
even
like
in
kind
of
the
last
few
weeks
right,
I
think
that's
probably
fine
like
if
the
first
like
large
increase
kind
of
passes,
then
that's
kind
of
like
tacit
approval.
That's
you
know
that
approach
is
like
valid
right
like
if,
if
the
large
changes
pass
in
the
executive,
then
that's
reason
to
believe
that
make
holders
support
taking
large
changes
in
the
future.
B
A
Yeah
it's
it
sounds.
It
sounds
almost
like
we
kind
of
need
to
figure
out
like
a
policy
right
going
forwards.
That
could
ideally
go
through
like
the
regular
government
like
the
weekly
governance
cycle.
So
do
we
maybe
want
to
kind
of
try
to
vote
on
something?
That's
a
little
bit
like
what
is
kind
of
one
step
removed
from
like
direct
changes
right
like
do.
We
want
to
sort
of
vote
on
whether
we
want
to
do
like
you
know
like
changes
that
double
each
time
that
we
have
to
do
it.
B
Yeah,
I
I
that
makes
sense
to
me,
but
I
just
think
it's
going
to
be
too
it's
too
early
to
even
come
up
with
various
strategies,
because
it
could
all
change
in
the
next
few
days
right.
So
the
strategy
that
might
be
valid
today
just
is
no
longer
applicable
starting
next
week.
By
the
time
we
get
governance
polls
going.
So
I
would
prefer
if
we
could
just
maintain
a
little
bit
more
nimble,
so,
okay,
so
then
how
about
so?
How
about
we
kind
of
do
it?
B
A
Yeah,
I
think
that's
true.
I
mean
it's
always
important
to
remember
that
this
is
an
emergency
call
with
like
an
hourly
time.
So
this
isn't.
This
group
isn't
necessarily
representative
of
the
wider
community
but
yeah.
I
think
in
general,
like
I
agree-
and
I
think
kind
of
talking
about
like
this
sort
of
being
nimble
thing.