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I'm not sure if the recent madness qualifies as the flash crash you were expecting, but the Dai peg has held up remarkably well. Part of it is the improvements in the liquidation auction mechanism, but a more basic assumption is that the large Maker PSM (about 6b of USDC on the balance sheet redeemable for Dai) kept the peg secure.

Love the point that DeFi doesn't have the luxury of a centralized exchange (or even regulator) who can help introduce mechanisms to avoid harmful externalities. The more relevant approach seems to be providing access to as much liquidity across the market as possible - something uniquely available in the highly connected world of blockchains. Part of the reason the Maker auctions have held up well.

Anyways, old post, caught it from your more recent one, but in the current market madness this was really relevant. Great stuff Brent!

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