Sky

Sky is the protocol long known as MakerDAO, renamed in August 2024. Its job has not changed: it lets people create dollar stablecoins by locking collateral in smart contracts, holds reserves to keep those coins near $1, and pays holders a savings rate from the interest borrowers pay. What changed is the packaging. USDS replaced DAI as the main stablecoin, SKY replaced MKR as the governance token, and a set of semi-independent units called Sky Agents, such as Spark and Grove, took over parts of the business.

MakerDAO was formed in 2014 by Rune Christensen, and its stablecoin first went live on 18 December 2017 as Sai, according to Wikipedia. The project's GitHub organization dates from May 2015. Writing on the governance forum in October 2024, Christensen said USDS passed a billion in supply two weeks after launch, while DAI supply held at about 4.7 billion.

There is no company that owns Sky. Rule changes pass by executive vote of SKY holders on vote.sky.money, and the protocol's contracts accept them only after a governance delay. The sky.money site is run by Skybase International, which describes itself as an independent Sky Agent that does not control the protocol's contracts or governance.

New stablecoins enter circulation in three main ways. A borrower can lock collateral in a vault and mint USDS or DAI against it, paying a stability fee. Anyone can swap USDC for USDS one-for-one, with no fee, through the Peg Stability Module, which is the main tool that holds the price at a dollar. And Sky's governance can allocate stablecoin to Agents, which deploy it into lending markets and other assets and pay part of the income back to the protocol.

DAI and USDS are interchangeable. A converter contract swaps them one-for-one in both directions with no fee, and Sky's developer docs state that fees cannot be enabled on that route in the future. DAI remains supported for holders and integrations that use it. The USDS token contract is upgradeable, using the UUPS proxy pattern, which means governance can change its code.

sky.money reports $15.60 billion of collateral behind USDS. DefiLlama's lending page for Sky shows $5.23 billion in collateral vaults on Ethereum; the rest sits in stablecoin reserves and Agent allocations that Sky does not break down on its homepage. Reading the full balance sheet takes the protocol's dashboard or governance reports rather than one figure.

The Sky Savings Rate is paid to anyone who deposits USDS and receives sUSDS. It comes from protocol surplus, is set by governance and can move at any time; Skybase's risk disclosure notes it can fall to zero. On 29 October 2026 sky.money showed the following variable rates.

None of these products charge a sky.money fee today, according to Skybase's terms. The stUSDS line is the one most likely to surprise: it lends against SKY, so a fall in the SKY price can turn into bad debt borne by stUSDS holders. Rewards paid in SPK or GROVE are worth whatever those tokens trade for.

SKY is the governance token. MKR holders can convert at 1 MKR to 24,000 SKY. Since 18 September 2025 a 1% penalty applies to late conversions, rising by another percentage point every three months unless governance decides otherwise, according to the upgrade timeline. Voting now runs on SKY in the Chief V3 contract.

Sky's governance is powerful. It sets stability fees, the savings rate, collateral types, debt ceilings and Agent allocations, and it can upgrade contracts such as USDS. A pause delay sits between an approved vote and execution, and Sky's docs list 'there is no way to bypass the delay' as a core invariant. Skybase's own risk disclosure warns that governance can be concentrated among a few large holders. For how Sky's record compares with other protocols, see how Sky compares with other DeFi protocols.

Sky's contracts are non-custodial and have run in some form since 2017. Its bug bounty on Immunefi, live since February 2022, pays up to $10 million for critical smart-contract findings, capped at 10% of the funds directly at risk. The developer docs publish security mechanisms and development practices, and the chainlog lists every live contract address.

The protocol's worst day was 12 March 2020, known as Black Thursday. As ETH fell and Ethereum congested, keepers stopped bidding in liquidation auctions, and one keeper won ETH collateral for zero DAI for two to three hours. Vault owners lost about $8 million of collateral, according to a later forum summary, and the system was left about $4 million short, which it covered by minting and selling new MKR. MKR holders voted in April 2020 to compensate vault owners, then rejected two compensation plans that July and September. The auction system was later rebuilt; DefiLlama links a Quantstamp audit of Maker's 'Liquidations 2.0'.

Today's risks are different. USDS depends on the Peg Stability Module and on Agents' investments holding their value. Rewards and rates depend on votes. The token contract can be upgraded. And on the sky.money interface, users in the United Kingdom, China, Hong Kong, Russia and many other places are not allowed to use the service at all.

The contracts accept any wallet. The sky.money interface lists prohibited jurisdictions in its terms: Afghanistan, Belarus, Burma, Burundi, Central African Republic, China, Crimea, Cuba, the Democratic Republic of the Congo, Donetsk, Ethiopia, Guinea, Guinea-Bissau, Haiti, Hong Kong, Iran, Iraq, Kherson, Lebanon, Libya, Luhansk, Mali, Nicaragua, Niger, North Korea, Russia, Somalia, South Sudan, Sudan, Syria, the United Kingdom, Venezuela, Yemen, Zaporizhzhia and Zimbabwe. The terms add that some features are geo-restricted elsewhere without naming them, and they are governed by Cayman Islands law.

To start, connect a self-custody wallet at sky.money. You can swap USDC for USDS one-for-one, upgrade DAI to USDS, or deposit USDS for sUSDS. Leaving is the reverse: redeem sUSDS for USDS, then swap USDS for USDC through the same module or sell it on an exchange. None of these steps has a lock-up. A separate route for SKY, 'sealed activation', carries an exit fee that governance sets and that starts at 5%, per Skybase's terms.

Spark, a Sky Agent, runs a separate lending market and savings product built on Sky's stablecoins; it has its own profile.

Sky's history runs from one of the first DeFi apps to a rebranded stablecoin network.

• 2014: MakerDAO formed by Rune Christensen.
• 18 December 2017: the first stablecoin, Sai, launches on Ethereum.
• 12 March 2020: Black Thursday zero-bid auctions; deficit covered by MKR auctions.
• July and September 2020: compensation plans for affected vault owners rejected.
• February 2022: Immunefi bug bounty opens.
• August to September 2024: rebrand to Sky; USDS and SKY launch.
• October 2024: USDS passes 1 billion in supply.
• 18 September 2025: delayed-upgrade penalty starts on MKR conversions.
• 1 September 2026: sky.money terms updated to version 2.0.