Evening
So Ethereum based blue chip stable coin protocol MakerDAO today announced a four-phased integration with roll up based Ethereum layer 2 scaling solution, StarkNet. MakerDAO's bridging to StarkNet will happen on 28 April, promising lower transaction costs and increased speed.
StarkNet is a ZK-Rollup developed by Israeli company StarkWare, and was launched a few months ago. Roll up based solutions like StarkNet, handles Ethereum network congestion by processing transaction off the main chain and latter post it on main Ethereum network. This marks the first time MakerDAO have launched on a zero knowledge(zk) technology based roll up.
Out of the four phases, first phase will be building a simple bridge to StarkNet and is slotted to happen on 28 April. Second phase involving fast withdrawals from layer 2 to layer 1, will be done in Q2 this year. Third phase involves teleportation i.e. fast movement of DAI stable coin between layer 2 and main Ethereum network, will go on in late 2022. Final stage integration of MakerDAO with StarkNet will happen up till early 2023.
MakerDAO already integrated last year with Ethereum Layer 2 solutions Arbitrum and Optimism. But the protocol have faced severe criticism from crypto community for having high percentage(about 50%) of their collateral in USDC stable coin which is a centralized stable coin.
DAI has been under severe pressure from the relatively newcomer algorithmic stable coin, Terra's UST. Terra's UST have been gaining a lot of traction since fast few month and it have already left DAI behind in terms of marketcap. Recently Terra’s co-founder, Do Kwon pledge to end DAI. A new pool termed as 'pool4'for UST have been launched on Curve Finance, offering heavy incentives to liquidity provider and aims to drain DAI based 'Pool3'.
Terra's rise have already given birth to panic among MarkerDAO's ranks and several proposals are under discussion to make DAI reclaim its lost ground. Recent integration to ZK-Rollup StarkNet is a move to advance MarkerDAO to a multichain future, as the stable coin wars intensifies. What good it will do, I guess we will soon find out.
In the end, its all about survival of the fittest.
