What is Sky (SKY)?

Deep Dive

1. Evolution from MakerDAO

Sky Protocol is not a new project but the rebranded and upgraded version of MakerDAO, launched in August 2024. This "Endgame" plan was a complete structural overhaul designed to make the protocol more scalable, user-friendly, and community-driven. It inherits over a decade of security-first operation from its predecessor, positioning it as a mature foundation in DeFi.

2. SKY Token: Governance and Staking

The SKY token replaced the legacy MKR token at a 1:24,000 conversion ratio to make governance more accessible. SKY is the exclusive governance asset, allowing holders to vote on protocol decisions or delegate their voting power. Users can also stake SKY in the protocol's Staking Engine to earn rewards paid in USDS, creating a direct link between tokenholder returns and the ecosystem's financial health.

3. The USDS Stablecoin and Yield Ecosystem

At the heart of Sky is USDS, the successor to the DAI stablecoin, which is pegged 1:1 to the US dollar. Its primary innovation is the Sky Savings Rate (SSR), a module that lets users earn yield simply by holding USDS. The protocol generates revenue from fees (like stability fees on loans) and yield from real-world asset (RWA) investments, which funds the SSR and other rewards, creating a sustainable yield engine.

Conclusion

Sky is fundamentally a decentralized financial ecosystem built on proven infrastructure, using its governance token (SKY) and yield-generating stablecoin (USDS) to create a sustainable model for on-chain savings and lending. How will its modular "Stars" system drive the next wave of DeFi innovation?