Maker,
which
just
rebranded
to
Sky,
announced
a
new
version
of
its
$5
billion
stablecoin
DAI
but
crypto
enthusiasts
weren’t
impressed.
The
new
token
called
USDS
apparently
has
a
piece
of
code
that
would
allow
the
issuer
to
remotely
freeze
the
asset,
observers
pointed
out.
The
feature
exists
in
the
largest
stablecoins
of
centralized
issuers
like
Circle’s
USDC
and
Tether’s
USDT.
They
often
freeze
assets
linked
to
illegal
activities
at
the
request
of
government
authorities,
like
Tether
did
last
week
by
aiding
the
U.S.
Department
of
Justice
in
the
seizure
of
$5
million
of
USDT
for
fraud
victims.
However,
the
feature
goes
against
crypto’s
decentralized
ethos
that
MakerDAO
pioneered
at
its
launch
and
rattled
many
decentralized
finance
(DeFi)
enthusiasts.
Rune
Christensen,
the
co-founder
of
MakerDAO,
confirmed
the
existence
of
the
freeze
function
but
explained
that
it’s
an
option
built
into
the
code
and
won’t
be
switched
on
when
the
token
goes
live
next
month.
He
also
added
in
a
separate
post
that
“upgrading
to
USDS
is
optional,
and
it
is
only
USDS
that
will
have
a
freeze
function.”
“Dai
is
an
immutable
smart
contract
and
cannot
be
altered,”
he
said.
AJ
Scolaro,
senior
analyst
at
crypto
research
firm
Messari,
said
that
concerns
are
overblown
as
the
feature
was
already
public
knowledge
and
is
necessary
for
a
stablecoin
backed
in
part
with
U.S.
Treasuries
to
reach
widespread
adoption.
“The
sudden
USDS
fud
[fear,
uncertainty,
despair]
is
funny,”
he
said.
“We
knew
about
the
freeze
function
several
months
ago;
it’s
100%
necessary
to
safely
scale
an
RWA-backed
stablecoin.”
“A
major
decentralized
stablecoin
should
both
be
governed
by
its
users
and
able
to
comply
with
legal
systems,”
he
added.
“PureDai
will
be
a
reasonable
alternative
offering
for
skeptics.”
Christensen
previously
floated
plans
to
craft
a
purely
crypto-backed,
decentralized
stablecoin
referred
to
as
PureDAI.
