Will Maker DAO’s Developer Incentivization Favor Short-term Price Rise?

Taking the market by surprise, MakerDAO, the decentralized organization (DAO) behind the DAI stablecoin, recently announced that it will start offering a maximum of $10 million bounty to ethical hackers and cybersecurity specialists who are able to point out legitimate security threats in its smart contracts.

The Larger Bug Bounty

MakerDAO is set to roll out a bug bounty program with Immunefi, the leading crypto security services platform, promising a record payout of $10 million to whitehat hackers. The platform plans to front-run attacks on its smart contracts is the largest ever bounty with a maximum single payout of $10 million in DAI. 

With that MakerDAO’s bug bounty program claims to be not only the largest hosted on Immunefi but also the biggest in the entire tech space.

Notably, Immunefi’s website claims the bugs found have averted up to $20 billion in damages from hacks.

For now, as per reports by Immunefi, Whitehat hackers stand to gain payouts ranging from $1,000 for low-level vulnerabilities going up to a maximum of $10 million for critical issues found in Maker’s smart contracts and apps. The payouts are set to be made in DAI stablecoins. 

Notably, the next largest bug bounty on Immunefi is a $3.3 million bounty from Olympus DAO, which was launched in January. The platform’s largest payout of $2 million was awarded to a security researcher who found a critical vulnerability in the Polygon Plasma Bridge last year. 

Can This Push Maker Price?

MakerDAO’s token MKR has often reacted well to larger market runs as well as ecosystem-centric developments.

Yet again, after MakerDAO was in news due to its latest bug bounty program, there was an anticipation of a price rise for MKR among holders. However, due to Bitcoin’s price rejection at the $44.5K mark, the larger market’s trajectory turned southward. 

MKR much like most of the altcoins noted over 5% daily losses and close to 10% drop in price by the week. As the token traded at $2,113, Maker’s larger market dependence in terms of price could be seen. 

Notably, MKR could see good long-term growth with developer incentivization programs like the bug bounty recently announced. However, in the short term, the MKR price trajectory could be dependent on BTC and the larger marker.