Overview
The Endgame Plan
This documentation describes planned functionality and processes that MakerDAO has not yet implemented. Be aware that parts may be inaccurate or out of date.
The Endgame Plan is a proposal to overhaul and improve the governance and tokenomics of the Maker Ecosystem. Its primary aim is for the ecosystem to reach a self-sustainable equilibrium called the Endgame State. In this state, the ecosystem is resilient, and the scope and complexity of Maker Core will no longer change.
The Endgame Plan was introduced by Rune Christensen, the co-founder of Maker. After a series of initial discussions, Maker Governance accepted the MIP set ratifying this plan on 24 October 2022. The Endgame Plan remains in active development, led by Rune Christensen. The latest complete and published description of the Endgame Plan is available here. Note that some parts are now out of date.
Goals
The Endgame Plan has many goals which come together to create the Endgame State. A list of these goals is below:
Ensure that Maker Core is more resilient to external risks such as regulatory action.
Ensure that the Maker Ecosystem can scale in a decentralized manner.
Align incentives for all participants in the Maker Ecosystem resulting in positive community culture and engagement.
Reduce governance overhead for MKR holders and Maker delegates.
Cut scope creep in Maker Core.
Ensure that Maker has a meaningful charitable impact.
Reduce MKR concentration through revised tokenomics and MKR emissions.
Core Elements
The Endgame Plan consists of the following main components:
The Maker Atlas specifies the core scope of Maker Governance. The Atlas is meant to be as immutable as possible. This simplicity and immutability guarantees long-term transparency about the purpose of MakerDAO.
The full Atlas document is available here.
The Endgame Plan is based on reorganizing the existing decentralized workforce ecosystem into new self-sustainable DAOs called SubDAOs. Since each SubDAO is a DAO, it will have its own unique governance token, governance processes, workforce, and interfaces.
SubDAOs are expected to maintain a synergistic relationship with Maker Core through appropriate alignment of incentive structures.
Moving much of the developmental, operational, and governance work to SubDAOs makes Maker Core simpler and more resilient.
Maker Core will consist of five Scopes. A Scope is a broad focus area for any work done to operate or improve the protocol.
The goal of introducing Scopes is to limit scope creep and ensure that any work done aligns with Maker Core's goals.
Each Scope has a set of Scope Artifacts that define the rules that SubDAOs must adhere to. Scope Artifacts will be refined over time to maximize profit and minimize risk to Maker Core.
Scope Artifacts limit the governance overhead by ensuring that Maker Core only focuses on high-level decisions. They also encourage innovation among SubDAOs without allowing them to take excessive risks that may damage Maker Core.
Aligned Voter Committees (AVCs) are groups of voters with aligned values and views. AVCs engage in the important high-level questions of Maker Governance. Every AVC must include an Alignment Conserver, an entity that has pledged to support the Atlas.
The objective of AVCs is to ensure that they represent MKR voters that are aligned with the values of that AVC. Members of AVCs will be compensated for their engagement under certain conditions, thereby incentivizing active governance.
AVCs work together with Aligned Delegates and Advisory Councils to implement specific governance changes.
The Endgame Plan has several major tokenomics updates.
First, the Endgame Plan modifies the MKR burn mechanism. The protocol uses profits to purchase liquidity pool tokens represent liquidity pools holding various combinations of MKR, Dai, and SubDAO governance tokens. The aim of these token purchases is to ensure alignment of interests between Maker Core and SubDAOs. The accumulated liquidity pool tokens are then used to buy and burn MKR at suitable opportunities.
Second, annual MKR minting will be used to incubate SubDAOs, fund AVCs, and incentivize the workforce. These emissions counteract the burn mechanism and reduce the likelihood of MKR becoming concentrated in the hands of large holders.
Third, users may lock up their MKR in a new module but continue to use it to participate in governance. Such locked-up MKR is eligible for Dai and SubDAO token farming rewards. When users wish to unlock their MKR from this module, a percentage of their initial deposit is burned.
Maker Governance no longer guarantees that MKR will function as a backstop in the event that Maker becomes insolvent. Governance may instead choose to adjust the Target Price of Dai which would result in a loss in value for Dai holders.
Page last reviewed: 2023-08-03 Next review due: 2023-11-03
Last updated