What is MakerDAO? Rebranding and new stable coin USDS

MakerDAO, the pioneering force in the DeFi ecosystem, has embarked on an exciting new chapter by rebranding itself as Sky. This bold transformation introduces a fresh stablecoin, USDS, poised to succeed the widely recognized DAI. The governance token MKR has been revitalized and reintroduced under the new ticker, SKY.

What’s more, DAI and MKR will remain actively in circulation, with users enjoying the seamless option to exchange them—1:1 for USDS and 28,000 SKY for each MKR. This move signals a dynamic evolution in decentralized finance, sparking enthusiasm and anticipation among crypto enthusiasts and investors.

How MakerDAO work?

MakerDAO invites traders to earn interest on DAI held in its system, functioning like a credit processing facility where stability fees act as interest rates. When fees are low, traders lock up more ETH tokens to create DAI, but higher fees lead to CDP (Collateralized Debt Position) closures, affecting DAI’s market value.

To generate DAI, traders deposit Ether or other accepted cryptocurrencies (e.g., BAT, USDC) into a MakerDAO smart contract, creating a CDP. The collateral must exceed 150% of the DAI’s value. To unlock the collateral, traders repay the DAI plus stability fees. If collateral value falls below 150%, it’s liquidated to cover costs.

Additionally, MakerDAO offers a DAI Savings Rate, allowing DAI holders to lock up their tokens and earn interest, backed by the stability fees.

MakerDAO Rebranding: USDS and SKY

The newly introduced USDS stablecoin is designed as a more sustainable and scalable alternative to DAI, while maintaining a 1:1 conversion ratio with DAI. This seamless conversion makes the transition smoother for users within the ecosystem, offering an easy shift to the new currency.

The SKY token has been launched as an enhanced governance token, providing holders with access to exclusive features like the Sky Savings Rate (SSR) and Sky Token Rewards (STRs), which incentivize active participation in the Sky ecosystem. These features are set to elevate the utility and appeal of the SKY token.

Sam McPherson, CEO of Phoenix Labs and Spark Protocol, initially revealed that USDS would include a freeze function, similar to centralized stablecoins like Tether (USDT) and USD Coin (USDC). However, McPherson deleted his tweet shortly after, sparking curiosity among the community.

Despite the deletion, further information emerged from one of Sky’s developers, clarifying that the freeze function won’t be available at the USDS launch. The freeze option cannot be immediately integrated since DAI operates on an immutable smart contract. However, the possibility of adding such a feature in the future has not been ruled out.

Conclusion

MakerDAO’s rebranding to Sky represents a forward-thinking shift that enhances its appeal in the DeFi ecosystem. By introducing the USDS stablecoin and the updated SKY governance token, MakerDAO is not only improving scalability and sustainability but also offering users new opportunities to engage with the platform through innovative features like the Sky Savings Rate and Sky Token Rewards.

This rebranding is likely to attract a broader audience, boost user participation, and solidify MakerDAO’s leadership in decentralized finance. The potential for future enhancements, like the freeze function, further demonstrates MakerDAO’s commitment to continuous innovation and adaptability, ensuring its relevance and resilience in the ever-evolving crypto landscape.

Looking for the best deals to buy stablecoins? Don’t miss out on the top offers available right now—click here to explore and secure the most competitive rates in the market.

Fiatom will help you find the best place to buy crypto