Sky | Trading Non Stop

What is SKY?

Sky (SKY) is a decentralized finance (DeFi) platform built on Ethereum that offers users secure, non-custodial savings and governance tools. It uses its stablecoin USDS and governance token SKY to provide these services. Sky evolved from MakerDAO, focusing on making DeFi more accessible, scalable, and suitable for institutional use.

Stablecoin Ecosystem: USDS is an improved version of DAI, allowing users to earn savings rewards and borrow against collateral.
Governance & Tokenomics: SKY replaces MKR as the governance token, with features like buybacks and staking rewards to encourage participation.
Modular Expansion: Includes projects called "Sky Stars," such as Spark and Grove, which offer specialized DeFi services and connect to real-world assets.

Deep Dive

1. Core Purpose & Value Proposition

Sky Protocol centers on non-custodial savings and decentralized governance. Users can hold USDS, a stablecoin pegged to the US dollar, to earn interest through the Sky Savings Rate (currently 4.5% annual percentage yield) or earn SKY tokens via Sky Token Rewards. This setup gives users control over their funds while offering opportunities to grow their savings without relying on middlemen (Sky.money).

2. Tokenomics & Governance

SKY: This token governs the platform through decentralized voting. It replaced the older MKR token at a fixed rate of 1 MKR to 24,000 SKY. The protocol has retired over 1.1 billion SKY tokens through buybacks as of August 2025, which helps reduce supply and potentially increase value.
USDS: The main stablecoin of the platform, USDS is fully interchangeable with DAI on a 1:1 basis but includes enhanced features like cross-chain liquidity enabled by SkyLink, which integrates with Ethereum Layer 2 solutions for faster and cheaper transactions.

3. Ecosystem & Innovation

Sky Stars: These are independent projects within the Sky ecosystem. For example, Spark focuses on lending services, while Grove handles institutional credit products. Grove has deployed $1 billion into tokenized collateralized loan obligations (CLOs) using Centrifuge technology.
Institutional Focus: Sky targets regulated real-world assets (RWAs) and currently holds $2.5 billion in stablecoin reserves. It also partners with firms like Janus Henderson to manage AAA-rated CLO strategies, bridging traditional finance and DeFi.

Conclusion

Sky builds on MakerDAO’s foundation with a modular, user-friendly approach that combines stablecoin savings, governance incentives, and tools designed for institutional investors. Its future success depends on growing the Sky Stars projects and increasing adoption of USDS. Will Sky’s ecosystem lead the way in connecting traditional finance with decentralized innovation?