Maker, the company now known as Sky, has introduced a new version of its $5 billion stablecoin DAI. However, it was observed that crypto enthusiasts were not very impressed by this innovation.

It was stated that the new token, called USDS, contains a piece of code to freeze the asset remotely. This feature is available on most major stablecoins used by centralized issuers, such as Circle’s USDC and Tether’s USDT.

These stablecoins can freeze assets linked to illegal activities at the request of government authorities. For example, last week Tether assisted the US Department of Justice in seizing 5 million USDT for fraud victims.

However, this feature contradicts the crypto world’s understanding of decentralization, and MakerDAO is known to pioneer this concept. This has disturbed many decentralized finance (DeFi) enthusiasts.

Rune Christensen confirmed that the freeze function is available but explained that this feature is an option built into the code and will not be enabled when the token is launched.

He also noted that the switch to USDS is optional and only USDS will have the freezing function. “DAI is an immutable smart contract and cannot be changed,” Christensen said.

AJ Scolaro, senior analyst at crypto research firm Messari, stated that concerns about the freezing function are exaggerated. He said this feature was already publicly known and necessary for widespread adoption of a stablecoin backed in part by U.S. Treasury bonds.

“The USDS fud that suddenly appeared is funny,” Scolaro said, adding that this function was known a few months ago and is 100% necessary for the safe scaling of an RWA-backed stablecoin.

“A large decentralized stablecoin must be both governed by its users and able to comply with legal systems,” Scolaro added. “SafDai will offer a reasonable alternative for skeptics.”

Christensen had previously floated plans to design PureDAI, a decentralized stablecoin backed solely by crypto. This plan aims to gain wider acceptance in the crypto world and aims to move away from the centralized features of existing stablecoins.

While the freezing feature offered by USDS has caused controversy in the crypto community, some analysts argue for the necessity of this feature. Analysts state that stablecoins targeted for widespread adoption must be compatible with legal systems, and think that such features can increase the security of the system.

Whether MakerDAO will be able to maintain the decentralized approach it pioneered in the DeFi field continues to be an issue that the crypto community follows with interest.