ETHWarsaw 2023: Bartek Rutkowski, Phoenix Labs - Entering MakerDAO Endgame with Spark

okay hello everyone uh is it too loud no it's okay please like it's okay okay um so my name is bar kovski and uh I work for Phoenix labs and research and development company that's focused on contributions to spark protocol and maker do and I'm here to walk you through some latest changes in the makerd ecosystem uh related to the end game and newly born spark so first of all uh oh and first I'm going to mention that of course uh all the opinions are my personal um so yeah the agenda first I'm going to uh say a little bit about the end game then I'm going to introduce you to spark and then um yeah just like why would you care uh I will just tell you why would you care about that so first uh maker da endgame uh everyone is familiar with what maker da is just please let raise your hand so I'm not doing an introduction to maker okay majority majority but still so maker da is a decentralized autonomous organization behind one of the largest stable coins out there in the space di um which uh is actually third largest at the moment and the largest decentralized one with uh over $3.8 billion in capitalization so quite large and such a big da is usually pretty slow and the biggest da one of the biggest Dows can actually be very slow and clunky and uh it might be very hard to do anything constructive within such a such an organization so um following an old rule uh maker decided to divide and conquer divide and conquer so extract most of the logic out of the main organization uh maker Dow now introduced set of subd so the maker core is only going to be responsible for systematic risk strategic decision- making and all the largest highest levels highest level decisions but all of the Daily Business and decisions related to technology or other things are going to be delegated to one of the subd the subd that are going to uh be there are facilitator subd which I'm not going to focus that much about but are going to work on organizing internal mechanisms of maker and help facilitate all the process and then allocators Dow which are going to be directly responsible for generating D and creating utility for the stable coin and also there are going to be so-called mini DS which are going to be subd of Subs so these are probably going to be under the allocator DS um yeah so what is spark uh spark actually consists of three main parts uh spark land spark SDI and Spark conduits spark land is a landing protocol uh that similarly to other Landing protocols like compound orave lets you deposit a collateral uh and then draw some debt sparland is uh integrated directly with maker so whenever you are borrowing dye uh you are actually minting new dye um using uh your collateral that is in the that is in the protocol so that ensures stable yield uh which is unlikely uh to happen in in in other similar protocols where the interest rates are always dependent on the utilization and uh Ever Changing uh conditions of the of the ecosystem here uh the interest rate is stable um and equal to the base rate of the maker core at the same time on the other front there is oh so first just wanted to um do shout out to spark that is growing quite rapidly because in uh just a few months of its existance it passed over 400 millions of dollars in tvl and uh equaled $200 million and drawn debt in die um yeah and on the second end there is the S die which is uh the wrapper around the DSR DSR die savings rate so the module of maker Dow that absorbs excess D and uh and uh AC additional value on on on the D which is which which which is sourced from the fees paid by the by the d uh borrowed uh from from other sources and Spark conduits which is uh the key component uh and the most interesting one that I'm going to uh talk the most about so the conduit is the secret source of spark land and what makes it so special and what allows it to be integrated so tightly with uh maker da and draw that uh directly from its source um it's a it's an adapter that uh that can be attached to virtually anything within Defi and remove the necessity to find lenders or external liquidity and just mint dye uh basically at any time and that's the spark da these three products um and Spark Dow is one of the Maker subd subd 2 so why is it important and why why uh does it actually make sense and is interesting so of course sparland and Spark SDI are very cool products and I highly recommend for you to check them out either if you are looking for a for for Deb to draw um in defi or uh you want to look for a place to deposit your stable coins actually Vols FYI of course features DSR as well and SD but uh the spark conduit is the thing that uh I'm the most excited about and that's what is interesting for Builders so as we all know stable coins are the live blood of Defi and everyone needs stable coins in most protocols run or work around some sort of stable coin and liquidity is the key and bootstrapping new project is usually rather hard and of course protocols with lots of liquidity are efficient um can attract uh attention can attract uh more users and basically there's this kind of spiral uh that that just uh that just enhances itself while if the liquidity is low then there's no incentive to for new users to join and basically um the protocol is stuck so high liquidity at the very beginning is is super important so it might be the case that you have an idea for a project for a protocol for whatever that has a unique business model that has features that users need but for any reason it needs a stable coin you want to Mint a stable coin well it's going to be a tough way creating a new stable coin of course is going to be a great adventure but it's not going to be the easiest one and for sure you're going to struggle with Demand with maintaining the peg with uh providing liquidity all these problems are ahead of you maybe worth fighting for but maybe there's a solution for just a small price of maker core base fee you can accept d as your L Lord and Savior and instead of creating your own stable coin you can build uh conduit and draw that directly from maker on the other hand if you have the unique business model and you have the value and you have the features that users need but you just struggle to find the lenders not because of the projects itself uh but I mean there are some there there can be a set of characteristics that on one hand will make a protocol make sense but it might not be super attractive to users for example lockup times or or any other things that that that will make it hard um to attract lenders then don't do this there is no point uh this is not sustainable and will not uh ever make any protocol successful in the long term instead go to maker maker is not about hype maker is not about narrative it's not about incentives it's not about uh coolest tweets is about solid business model and if your protocol can create a revenue stream and pay the basee rate then uh it find its home within the maker ecosystem and yeah so that is that might be the place for your protocol so the maker core as I mentioned allocators D they are going to be four allocators Dallas that will um draw thatb directly from maker core and then through conduits will allocate this debt to any type of opportunity within def space today it's sparland and and real world assets hidden deep in the in the in the maker core but it might be anything that you can uh come up with and that's why we want you to build a conduit and we want you to come up uh with the new uh ways to utilize D and use its power and yeah uh I truly believe that conduits are the future ultimate devices of growth of defi protocols as they provide you with instant liquidity and actually virtually unlimited amount of Dy at your fingertips you can check out the uh conduit documentation and code actually here so I'm just going to pause for like 5 Seconds to for someone to scan if they want to and say one more sentence so there's a little more time and that's it so thank you very much for your time if anyone has any questions [Applause] shoot you're great that was awesome thank you thank