Maker (MKR) Co-Founder Says Rebranded Stablecoin Will Have Freeze Function, But DAI Will Continue to Operate Normally

The co-founder of decentralized finance (DeFi) platform Maker (MKR) says that the rebrand of its stablecoin will have a freeze function but that DAI will continue to operate normally.

Stablecoin issuer Maker (MKR) is introducing a freeze function for its rebranded stablecoin, but DAI will continue to operate normally, according to the co-founder of the decentralized finance (DeFi) platform.

In a thread on the social media platform X, Rune Christensen said that DAI will not have a freeze function at launch, and that any future addition of such a mechanism will be decided upon by the protocol’s DAO (decentralized autonomous organization).

“There will be no freeze function at launch, there will just be an upgradeability. So later governance can decide how to implement something like a freeze function based on considering all data and find something that protects against as many risk factors as possible.”

The rumors of a freeze function being added to DAI began circulating after an early version of Maker’s announcement was leaked. The final announcement, which was published on Monday, made no mention of DAI being altered in any way.

According to Christensen, the rebranding of Maker’s stablecoin is being done in order to create a “more legally sound” product. The new stablecoin will be fully collateralized by fiat currencies and will be regulated by the New York State Department of Financial Services (NYDFS).

“The Sky Dollar (USDS) is a new stablecoin that will be fully collateralized by fiat currencies, and will be regulated by the NYDFS. It will be pegged to the US dollar and will be designed to be used for everyday payments and transactions.”

Christensen added that the new stablecoin will be available for purchase and trade on a variety of exchanges, including Binance, FTX, and Coinbase.

As reported by Cryptonews earlier this week, MakerDAO announced that it will be rebranding to the Sky (SKY) and will allow investors to swap their DAI at a 1:1 ratio for USDS, while the MKR token can be upgraded to 24,000 SKY.

At the time of writing, MKR is trading at $1,815, down 16% over the last 24 hours.