MakerDAO Founders Are Planning To Address Climate Change

• Avinandan Banerjee
• October 07, 2021

Rune Christensen, who is the founder of the MakerDAO protocol, has recently published an essay in which he has outlined the measures that could be undertaken in order to give the protocol a voice that can address the nuances of climate change.

A lengthy post that was published on the MakerDAO governance forum on the 5th of October, Christensen has asserted that it is imperative for MakerDAO to ensure that all their collateral must consist of assets which are sustainable and aligned with nature considering the lost lasting impacts of the financial activities on the already suffering environment.

Christensen has asserted with clarity that it would be beneficial if the collateral of the protocol can be properly invested into real world assets or RWAs that are entirely sustainable in their orientation, through senior credit positions existing in the projects that are engaged in building solar farms, batteries, recharging stations, wind turbines and other such renewable energy solutions that are also cost-efficient. 

He also expressed his concerns stating that the company should really focus on reestablishing their commitment to decentralize the collateral, and while doing so he advocated that it would be in their best interest that the protocol goes back to relying on the Ether token and consequently the Ethereum network. 

The users on the MakerDAO network deposit crypto assets into the network protocol in order to collateralize the minting of the DAI stablecoin on its network. Even though during the initial days , the protocol immensely supported the Ether network, over time they have started showing their support for other assets as well, such as the Wrapped Bitcoin, USD Coin and Basic Attention Token.

Christensen even outlined the improved environmental efficiency the network of MakerDAO would achieve through the use of the Eth2, which came into existence following the transition of Ethereum to POS or Proof-of-Stake consensus. He stated that as soon as the upgrade from Proof of work to Proof of stake is completed, Ethereum will transform into a highly energy efficient network. According to him, ETH can pose a serious threat to the supremacy of Bitcoin once the upgrade is completed.

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