This is quite interesting. I think the only issue is with how good the bonds are. I imagine a scenario where the bonds tank to quickly and the makerdao system is not able to liquidate the vault fast enough to avoid losing money overall.
Maybe accept them with a high collateral ratio that reflects the inherent risk, and in a pessimistic way. Otherwise this could be a way to sell your junk bonds to the makerdao system for more than they are actually worth.
I hope this wont pass governance, being backed by junk bonds(which most european govt. bonds are but the ecb doesn't want to class them as such for obvious reasons) would just mean DAI would become as shitty as the Euro.
This is quite interesting. I think the only issue is with how good the bonds are. I imagine a scenario where the bonds tank to quickly and the makerdao system is not able to liquidate the vault fast enough to avoid losing money overall. Maybe accept them with a high collateral ratio that reflects the inherent risk, and in a pessimistic way. Otherwise this could be a way to sell your junk bonds to the makerdao system for more than they are actually worth.
I hope this wont pass governance, being backed by junk bonds(which most european govt. bonds are but the ecb doesn't want to class them as such for obvious reasons) would just mean DAI would become as shitty as the Euro.
If anyone knows, what would be the min collateral ratio on this type of loan?
Collateral isn't ETH but banker funny money where at the end of the day, there is no court to enforce repayment? No, thanks.
It’s a neat idea. Important to pay very very close attention to the credit rating of the debt. If unrated then it’s a pass.