MakerDAO rebrands to Sky on September 18th, introducing new token names: SKY and Sky Dollar (USDS). SKY is the upgraded governance token replacing MKR, and USDS is the new version of the stablecoin DAI. DAI and USDS can be swapped at a 1:1 ratio, while each MKR token converts to 24,000 SKY.
These tokens were initially named NewStable and NewGovToken on August 22. The upgrade is optional, allowing users to switch back to MKR and DAI if desired.
KEY Takeaways
- MakerDAO Rebrands to Sky: MakerDAO has rebranded to Sky, introducing SKY (governance token) and USDS (stablecoin), replacing MKR and DAI. The upgrade is optional.
- Sky Protocol Overview: Sky Protocol lets users generate USDS by depositing DAI, USDC, or crypto collateral. It offers stability and a 6% annual return via the Sky Savings Rate.
- Stars (SubDAOs) and Sky Protocol: Sky operates decentralized communities (Stars) like Spark, where users can borrow USDS by collateralizing crypto.
- Sky and Aave Partnership: Sky and Aave are partnering to boost DeFi adoption through the Sky Aave Force initiative, aiming to enhance decentralized financial systems.
- Tokenization: MakerDAO plans to invest $1 billion in tokenized U.S. Treasury products, partnering with firms like BlackRock’s BUIDL to advance tokenization in finance.
- Crypto Hearings on September 18: Coinciding with the rebranding, the U.S. House will hold hearings on crypto regulation, which may impact DeFi compliance.
- Compliance with Freeze Function: USDS includes a “freeze function” to ensure compliance and prevent illegal activities, aiming for global reach.
What is the Sky Protocol?
Sky Protocol is a DeFi project enabling users to generate the USDS stablecoin by depositing DAI, converting USDC, or using crypto collateral on platforms like Spark. This system allows access to digital money without the volatility of non-pegged cryptocurrencies.
How Does Sky Protocol Work?
Sky Protocol relies on smart contracts centered around the USDS stablecoin and the Sky Savings Rate (SSR), offering 6% annual returns. Users interact with Sky via the sky.money platform, which facilitates upgrades from DAI to USDS and MKR to SKY, and engages in Sky Token Rewards campaigns. Stars, or SubDAOs, are specialized decentralized communities operating over Sky, like Spark, which allows for collateralized debt positions (CDPs) and self-generated USDS loans.
Sky and Aave Partnering to Boost DeFi Adoption
Sky and Aave have announced the Sky Aave Force initiative to promote DeFi adoption. Their goal is to create a more accessible financial system using decentralized technologies. The initiative leverages the expertise of both protocols to highlight DeFi’s benefits and position it as a viable alternative to traditional finance.
MakerDAO’s Move Towards Tokenization
MakerDAO plans to invest $1 billion of its reserves in tokenized U.S. Treasury products. Major players, including BlackRock’s BUIDL, are preparing to apply for the proposal. According to Coindesk, Carlos Domingo, CEO of Securitize, BlackRock’s issuance partner, supports this move: “We think this is a very good move from MakerDAO and we are excited to participate with BlackRock’s BUIDL.“
US House Committee Plans for Crypto Hearings on September 18
The U.S. House of Representatives’ financial-services committee will discuss various crypto issues, including DeFi and securities. This hearing is a critical event for the crypto community. DeFi protocols, including MakerDAO, will likely be a hot topic, with SEC Chair Gary Gensler facing the committee.
The rebranding to Sky, with its new freeze function, aims to address compliance concerns while maintaining a global reach. Sean Lee, co-founder and chief strategy officer at IDA, notes that compliance is crucial: “It’s less about centralization and more about being compliant.”
To Conclude
MakerDAO rebrands to Sky, marking a major shift in its governance and stablecoin system. With the new SKY governance token and USDS stablecoin, users can choose to revert to MKR and DAI if they prefer. This change emphasizes regulatory compliance, especially with the freeze function in USDS, aiming for global adoption. At the same time, partnerships with Aave and investments in tokenized assets demonstrate Sky’s ambition to grow DeFi and institutional involvement while aligning with regulatory trends in the crypto sector.
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