Sky sky

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Sky is a protocol that uses a set of smart contracts to essentially function as a decentralised bank that issues a stablecoin called USDS (USDS) to borrowers, who must deposit supported cryptocurrencies at varying collateral ratios exceeding 1:1 (i.e. overcollateralised loans).

The protocol is managed by a governance community consisting of holders of the SKY token. The DAO earns revenue through interest charged on loans (i.e. lending fees). It also earns income from certain interest-bearing assets such as tokenised U.S. Treasury bonds.

SKY is the governance token of the Sky protocol. It launched in 2024 and effectively replaced MKR at a rate of 1:24,000.

Holders of the SKY token participate in decentralised governance (e.g. vote on proposed protocol upgrades and changes) and trade for USDS. They also have the option to deposit their SKY into the staking engine to accumulate staking rewards, currently in the form of USDS tokens.