a16z Disagree To Break Up MakerDAO Into Smaller Units

The a16z investment fund has spoken out against MakerDAO’s proposal to turn Core Units into MetaDAOs with their own tokens to incentivize users.

MakerDAO, one of the largest DeFi protocols, is currently in the midst of a transformation as it tries to come up with plans to accelerate growth and make the protocol more decentralized. Now facing the problem when conflicts arise between investors and founders.

Venture capital fund Andreessen Horowitz (a16z) has issued disapproval of MakerDAO’s Endgame Plan proposal. a16z said it disagreed with the founder’s vision of breaking up MakerDAO into smaller specialized units, or MetaDAOs.

a16z is a large investment fund that has the potential to influence the final decision on the direction of MakerDAO. They gave their views on the future of the protocol, along with that countering some of MakerDAO’s founder’s arguments that the Endgame plan will help MakerDAO fight censorship and become more decentralized.

Porter Smith, a partner at a16z, wrote:

“The Core Unit structure is arguably already legally decentralized. Introducing MetaDAOs likely does not change this analysis, nor lead to more organizational resiliency from a strictly legal perspective.”

According to the memo, a16z would encourage testing through smaller, self-contained suggestions in order to provide a baseline for how suggested modifications could function (or not) in practice.

Smith wrote in a comment on the forum:

“Maybe experimenting with one MetaDAO (or one per type), iterating, and then rolling out an organizational change with real data and live experience could strike the balance here.”

There are currently two proposals open for MKR holders to vote on how to reorganize MakerDAO’s structure, including removing the protocol’s governing units and turning them into MetaDAO. At the time of writing, the poll shows that about 90% of people support the creation of MetaDAOs to replace Core Units.

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