RT @Melt_Dem: 1/ let's talk about today's @MakerDAO / @a16z announcement. for those who missed it, A16Z's crypto fund bought 6% of Maker tokens for $15M, at a 25% implied discount to the current price of $MKR. https://t.co/8FnLNXWG9b
1/ let's talk about today's @MakerDAO / @a16z announcement. for those who missed it, A16Z's crypto fund bought 6% of Maker tokens for $15M, at a 25% implied discount to the current price of $MKR. https://t.co/8FnLNXWG9b
MKR is a governance token. It should appreciate in value through good governance (MKR burned as fees), and depreciate through bad governance (more MKR minted to pay off bad debt if the value of the debt isn't enough to cover it). So on a simplistic level they're hoping MKR appreciates in value and will do what they can to achieve that
That's almost 50% off. Sweet deal for the big boys.
That said, it's very bullish that a16z sees MKR as a good investment and will be supporting it. MKR is an awesome project that has proved it's value.
kingofcairo1 - 2 years account age. 200 - 1000 comment karma.1 year ago
Exactly. This is fucked up. I like Maker, but homeboy discounts and the difficulty of obtaining maker currently prevent me from investing
tophertroniic2 - 3 years account age. 300 - 1000 comment karma.1 year ago
And you see no relationship between your difficulty of obtaining MKR and their discount on a block trade? As I posted above, this $15 mil exchange was greater than the entire MKR volume of the last 30 days. By 30%.
This. Everyone on heire should know the full story. Instead of buying like everybody else from open market, big boys already made profit by cutting a deal with the team and getting a 50% discount to a coin thats already trading. He sells now he made almost 15 mln. Bullsht
tophertroniic2 - 3 years account age. 300 - 1000 comment karma.1 year ago
MKR holders have governance over the MakerDAO. By taking a material number of tokens, AH is bringing their expertise to the project, and has real world votes to influence the execution of the project, and skin in the game. They didn’t go through this deal to flip the tokens and market sell. Additionally, AH has “been investing in crypto assets for 5+ years. We’ve never sold any of those investments, and don’t plan to any time soon.”
Does anyone here offer “full operational support from the 80+ person Andreessen Horrowitz a16z team?” No? Maybe bring something to the table and then you might be able to negotiate a private deal.
It’s a god damn $15 million exchange and MKR is very thinly traded. **CoinMarketCap shows $11.4 million of volume total for the last 30 days!** It would be **expected** to be sold at a discount in such an illiquid market.
I’m so sick of this shit. Every big player buys out the back door and waits on us little guys to buy and pump the price for them. The story keeps repeating when you dig deep enough about all the partnerships and hedge funds “getting in.” There are two prices for things and we need the big guys to buy on the market but they never do.
Agreed. If all the big players just buy OTC from the team, then what are we little guys holding on to these tokens for? We take all the risk buying early and once the product has proven itself, a big shark comes along and gets a big chunk of the pie at half the market price at zero risk. This is why we can't have nice things.
What big risk? The little guys who invested in this project back in 2015 when there was nothing more than a whitepaper are the ones who took all the risk. Maker is now more or less a proven product and team just has to upscale their operations. Investing big money at this stage is hardly a risk. There is no justification for selling 50% below market price. They should been told to buy off our hands from the open market.
There was risk in 2015 at a low price and there's risk now at a higher price in a low liquidity asset. Maybe you can tell us how it's a low risk after you buy 30x the daily volume of a certain asset.
They were never gonna buy at market price. Them buying OTC doesn't pump the price, but the founders selling doesn't crash it either. Transactions are between two parties.
It kinda sucks on a short time frame, but a16z is a pretty well known and well respected VC that has a reputation to maintain and an already good track record from what I’ve read. This isn’t a pump and dump where they got a discount and then they sell.
We don’t know the full terms of the agreement, but they should be contributing quite a bit via governance and risk proposals and connecting talent to the Maker ecosystem. I’m pretty excited myself.
VCs aren't in the business of making 2x returns. That would be considered a failure. VC shoot for the moon to make 1000x and invest uniquely in things that have that potential. 9 out of 10 (and probably more than that) will go to 0, but they make their returns off of the 1 that does succeed.
From what I have seen this year, VCs have been buying ICO allocations and reselling them to pools at 1.5x to 2x their acquisition price. So it seems they are perfectly fine with 2x returns. VCs are not stupid. They know that 2x is still a lot of money when investment size is $100m.
> Sure they will profit but that's what every investor wants no?
Profit shouldn't be guaranteed like this though. The team should have told them to buy at market price and then earn that profit like everyone else by holding on. By selling 50% below market price and that too at these bottom barrel prices, they have essentially taken all risk out of the investment. This is not the right way to attract investment IMO.
QryptoQid1 - 2 years account age. 200 - 1000 comment karma.1 year ago
They're balls deep in Basis and Trust Token which is backing TrueUSD
lazerswimmer3 - 4 years account age. 50 - 100 comment karma.1 year ago
>there's definitely no other stablecoin they are engaged with at the same level. There's a difference between just being an investment and then being a part of the core portfolio
is that panthera capital or A16?
QryptoQid1 - 2 years account age. 200 - 1000 comment karma.1 year ago
a16z is definitely involved with both. Pantera is in Basis... I don't know if they're in Trust, but I don't see them on https://www.trusttoken.com/ nor do I see TrustToken on Pantera's site.
>a lot of first mover dont make it - PARC, AOL, Yahoo, etc
The focus is really on executing MCD to ensure that Dai is the dominant stablecoin. I wouldn't nitpick these little things, the team has the right long term approach.
Actually paying $250 when the market price is $450 is a scandal. I would have turned it around on them and sold the 30k to them at market (similar cash in) then paid them with MKR at market prices for specific legal, regulatory, and political lobbying services provided - tied to concrete milestones and all that. you could easily have hired top lawyers, marketers and lobbyists for far less than $15m. Anyway, don’t want to rain on your parade - but i hope you have contractual commitments to these services, and clawbacks in case they don’t deliver
You don't get how important the source of funding is or how big a deal a16z is. Lawyers, marketers, lobbyists aren't enough on their own and the best ones are also selective about what work they take on. You also don't get who Katie Haun is. Look at her CV https://www.gsb.stanford.edu/faculty-research/faculty/kathryn-haun Effectively, she's one the top crypto lobbyists in the USA.
\>you could easily have hired top lawyers, marketers and lobbyists
We are also hiring top talent, in conjunction with this deal and others like it. What's great about deals like these is that the resources come as a full package, so they don't take significant onboarding overhead and can be done in parallel with our internal buildout.
It's about firing on all cylinders and being able to strike with full force at the critical moment when multi collateral dai is done and our first mover advantage as an ethereum based decentralized stablecoin is at it highest. We'll only really get one chance to either make it or break it, and if we succeed in reaching critical mass our position will be much more secure in the future.
You have to consider that regulation is one of the most important areas we need to focus on in order for the project to succeed. With that in mind, we felt it was important to work with someone who deeply understands both the regulatory landscape and also the nuance and innovation that makes projects like Maker fundamentally new and unique. Katie's background is a perfect fit. She was on the federal government's crypto task force and has since been entrenched in private innovation in the space for years. After getting to know her and the team we concluded they'd make the best partners to help us ensure our compliance efforts are on the right track.
To me it is clear that given this is our biggest challenge and threat, and given that we have such a strong leadership position in all other fields but regulation, there is no reason to compromise.
I admire the sense of urgency and the laser-like focus displayed here. I just hope those vultures (Polychain and Az16) don't take you out for a ride. Basis, Maker, Reserve, TrustToken, etc. they all look the same to them... just a means to an end. They will throw anybody under the bus in favor of the next new shiny thing that makes their pocketbooks happy.
Those “vultures” you’re talking about are:
1. Katie Haun
2. Jesse Walden
3. Olaf Carlson-Wee
4. Chris Dixon
5. Nick Tomaino
Have you watched any videos on these people? They seem like good people to me.
As far as shiny things go, well duh. They’re investors with excess capital and they’ll invest in similar projects like Basis, however, even Joey Krug said Maker is farther ahead then anyone else at the moment on crypto trader. IMO Maker is best positioned to win the stablecoin market. Let’s see what happens.
A well thought out and rational explanation. She is indeed one of the top names for regulatory expertise in the space. Maker proves it is top notch once again. Hopefully this provides all the runway the foundation needs to get MCD to main net. Good luck, and thanks for the time explaining your actions!
Does the team have any plans to get Dai onto Binance and Bittrex to facilitate trading pairs against Dai as opposed to USDT? I am uncomfortable holding USDT because there is always an air of bad news surrounding it and I get the feeling it can go belly up at any time. But at the moment there is no other option if you are an active trader. Holding Dai would help me sleep better at night.
Screw discord. Please keep all discussions to the Reddit sub instead. Most people don't even understand how valuable discussions on Reddit are as it's a public platform visible to the world and indexed by Google. Discord and Telegram are closed platforms where only members can discuss among each other and outsiders have no clue what is going on. Important discussions are also lost because the chat interface doesn't provide any means of archiving or spotlighting important information. Most importantly, since nothing is indexed by Google, newbies who would like to learn about the project miss out on a lot of critical information.
This is why I tell all new projects to have a Reddit sub and build the community here. Telegram/discord communities are useless, full of spam and small talk.
3x3q3 - 4 years account age. 400 - 1000 comment karma.1 year ago
I'd also love to see a Discord channel for MakerDAO.
AH is one of the most respected and prestigious vc funds. Top tier. VC firms do more than give cash. They give connections. Look at the cv of the person who signed them: https://www.gsb.stanford.edu/faculty-research/faculty/kathryn-haun
Marc Andreessen is a big name in the silicon valley. Founded Mosaic (basically the first web browser) and Netscape. He's been very successful in the VC world and his investments are heavily vetted and typically disruptive.
MakerDao and Dai really is the sleeping beauty of Eth. It's hard to grasp at once, just like blockchain and eth as a technology but once you do and start to think further, you are ready to put down 15 millions too, if you'd have as much to invest.
Now with multi collateral on its way ( already on testnet ) and this investment, we will begin to see the big wheels turning and everyone will know what Dai is.
sandalguy894 - 5 years account age. 63 - 125 comment karma.1 year ago
With Katie Hauns insight from her time as a federal prosecutor focused on cryptocurrencies, we have crafted a very strong plan for getting full clarity about our legal status in the US with the federal agencies that are relevant for the kind of financial activity Maker enables. Getting our house in order from a US regulatory standpoint is a crucial step that will open up major partnerships with established American enterprises.
Additionally there's also the added benefit of A16Zs marketing and business development teams that we can leverage as a force multiplier for our inhouse marketing and BD teams, however we consider this to be secondary to the value of having Katie Haun as an advocate for the project.
It's because of this major intangible value add that we were willing to sell such a large stake, and give a significant rebate from the market price at the time of the deal.
This is definitely very exciting! I am not complaining about any 'lack of transparency' because it's not like the mkr holders are well organized enough to strike deals at this point anyways, plus the foundation is doing a fantastic job... but it would be nice to have a more clear definition of what the foundation's role is. I know the foundation proposal set some direction, but I think a list of some of the direct intentions of the foundation could be nice, along with which functions and intended to be passed to mkr holders first on the 'gradual decentralization' timeline. I'm loving watching Maker mature.
It's an interesting dilemma - mkr holders are supposed to be in charge - but the foundation are really the only people in the position to make a deal like this - I honestly don't know how a distributed group of mkr holders could ever perform these kinds of functions - maybe there needs to be some sort of vote that says 'we the mkr holders give the foundation authority to make business deals and distribute up to X amount of mkr' as well as outline other actions mkr holders give the foundation 'permission' to do
I am sure, as soon as there is an easy to use interface to stake/vote more of those decisions will be made by the token holders. For now there was 1 Vote by MKR holders, and it was done by a chosen few of "technicaly able" holders.
>It's an interesting dilemma - mkr holders are supposed to be in charge - but the foundation are really the only people in the position to make a deal like this - I honestly don't know how a distributed group of mkr holders could ever perform these kinds of functions - maybe there needs to be some sort of vote that says 'we the mkr holders give the foundation authority to make business deals and distribute up to X amount of mkr' as well as outline other actions mkr holders give the foundation 'permission' to do
we are so early on in the project that we have to trust the mkr team and the foundation
The foundation proposal was an attempt to start the dialogue about the foundations role in the short run and in the long run. Our focus is on shipping MCD, but once it's out we will revisit the role of community governance and the foundation. In general the community is only meant to be responsible for the long run risk governance of the system. As you're pointing out yourself, it is simply not possible for a decentralized community to bootstrap a fintech product from scratch with the flexibility required to compete in the marketplace.
However as we grow bigger, it will gradually be possible to let the community use Maker governance to support the foundation in various development and adoption roles, and eventually the foundation will be eclipsed by companies and individuals in the community that are incentivized to sell dai-enabled products that indirectly result in dai adoption.
Thanks Rune! It's exciting to see the progress you are making, and obviously MCD has been consuming a lot of resources!
I am not in the camp of people that think just because they own .23 mkr they should have been texted about each business deal... I do think it would be helpful to have a blog post defining the roles so that mkr holders are better informed of what their role is in the system in order for mkr to be optimally beneficial. I think formalizing the relationship between mkr holders and the foundation is the next step after setting the philosophical direction of the foundation in the last vote.
This is really great news Rune! And the rebate was not even that high - USD 250 per MKR is totally reasonable considering what a16z can bring to the table.
Also good news for the whole of crypto - big players are still interested!
Next challenge will be on the team: how to sensible spend that much money (plus the swimmingpool you already had) in a sensible way?
Major congrats + hugs for the whole team!
Adreessen Horowitz started out as two partners, but they’re really a VC firm with 10+ full time staff. They actually have a great track record, being early investors in Skype, Twitter, and Coinbase among many others, some that made it some that didn’t or haven’t yet.
Great potential though to be attracting this much interest from top VCs.