Recently, Circle suspended USDC tokens belonging to 38 wallet addresses which were blacklisted by the US Treasury Department. These wallets were of tornado
tornado Technology 
Followers : 0 View profile Cash addresses.
Following this, MakerDAO has raised concern about the risks related to USDC. makerdao 
makerdao Crypto / Blockchain SolutionFinancial Service Provider 
Followers : 0 View profile founder, rune christensen 
rune christensen founder at makerdao
Rune Christensen is the co-founder and CEO of MakerDAO, which issues Dai, the world’s first stable coin on the Ethereum blockchain. Starting around 2015, Christensen has zeroed in on laying out the vision and authoritative construction of the Maker Decentralized Autonomous Organization and the financial underpinnings of the Dai stable advanced money. He is likewise familiar with Mandarin Chinese.
Probably the most grounded current in the Ethereum space all through 2019 was the developing environment of decentralized finance applications, with MakerDAO and the Dai stable coin assuming a critical part in this change in account and engineering center. MakerDAO cooperated with different activities all through the year with an end goal to extend the accessibility and utilization of Dai. In September, MakerDAO declared a designer award and cooperation with blockchain-based independent stage Opolis to carry Dai installments to the consultant gig economy. In August, MakerDAO collaborated with London-based financial elective endeavor Monolith to carry Dai installments to its Visa check card.
At the end of the year, MakeDAO declared an offer of $27.5 million in MKR tokens to Dragonfly Capital Partners and Paradigm to carry Defi to Asian business sectors. The greatest specialized update in the MakerDAO platform was the launch of Multi-Collateral Dai in November, which will widen the collateralized resources backing Dai past Ethereum. EntrepreneurInvestorChief Executive Officer Followers : 0 View profile , has asked the community members, through the company’s discord channel, to be prepared for a depegging of the DAI stablecoin from the US Dollar.
After the Office of Foreign Assets Control (OFAC) restricted residents from using Tornado Cash, Circle decided to freeze $75,000 worth of stablecoins. Following this, Rune claimed that these restrictions by OFAC are serious and MakerDAO should start preparing to depeg from USD.
Will The Entirety of USDC Be Converted Into ETH ?
It’s interesting to note that Rune plans to convert the afore-mentioned USDC into ETH. At the moment, USDC has collateral for more than 50% of MakerDAO’s DAI stablecoin. Hence, the founder appears very concerned with the dependency on single stablecoin and a centralized asset.
DAI’s market cap that stands at $7.5 billion, makes the currency one of the largest DeFi protocols by total value locked.
banteg 
banteg Banteg Developer/ProgrammerMarket Analyst Followers : 0 View profile , a core engineer at yearn finance 
yearn finance DeFi 
Followers : 0 View profile , tweeted that MakerDAO may propose converting all of its $3.5 billion USDC to ETH. As a result, more than 50% of DAI stablecoins will be secured by ETH, increasing from 7% currently.
The community is comparing this move to the Terra (LUNA) collapse and saying that this another “Terra in the making”. This is because the terra 
terra Blockchain Network Followers : 0 View profile network had made a similar mistake of backing all its USDT tokens with bitcoin org 
bitcoin org Event OrganiserTechnologyPayment solution 
Followers : 0 View profile . After USDT underwent a huge depegging, Terra was forced to liquidate all its BTC reserves.
Other individuals have spoken out as well.
Even vitalik buterin 
vitalik buterin co-founder at ethereum, Bitcoin Magazine Vitalik Buterin is a professional programmer and writer who is famous as the Co-Founder of Ethereum. Buterin along with Gavin Wood, Charles Hoskinson, Joseph Lubin, and Anthony Di launched Ethereum in 2014. He co-created Ethereum when he understood that he could construct a new, possibly enhanced version by iterating on the Bitcoin blockchain.
He has been involved in the Bitcoin community since 2011, writing and co-founding articles for Bitcoin magazine. Vitalik linked Bitcoin to a calculator and a future blockchain to a smartphone and used the same method of improving the system’s strength by making it more general purpose to blockchain network space.
He was honored with the Thiel Fellowship Award in 2014 for bringing his innovative scientific and technical projects to reality, won the World Technology Network prize, Fortune 40 under 40 lists, and appeared on the Under 30 list of Forbes at the age of 23. EntrepreneurDeveloper/ProgrammerAuthor 
Followers : 0 View profile , ethereum 
ethereum Blockchain NetworkTechnology Followers : 0 View profile co-founder, is of the opinion that this would be a risky approach. Vitalik states that if Ethereum plunges in its value, even the collateral value will drop. Hence, the overall system would be affected, making it a fractional reserve.
In reply to Vitalik’s comment, Rune Chirstensen replied that they don’t have any plan to transfer all of USDC into ETH and only might transfer a few.
Was this writing helpful?
This news is republished from another source. You can check the original article here
Be the first to comment