Sky Launches USDS Stablecoin on Solana

Author: Martin Young, CoinTelegraph; Compiler: Wuzhu, Golden Finance

Decentralized financial lending protocol Sky (formerly known as Maker) has deployed its USDS stablecoin on Solana to tap into blockchain’s growing decentralized finance (DeFi) ecosystem.

In a Nov. 19 post, Sky said its USDS is “Solana’s first major DeFi native stablecoin” and will allow new ways to lend, borrow and trade on Solana’s “top DeFi platform.”

“Today’s launch marks the first step in Sky’s strategy to increase Solana’s DeFi liquidity and [total value locked],” it added. In the future, pending governance approval, Sky says it will launch the SkyLink cross-chain bridge for USDS and sUSDS, the “savings” version of the stablecoin. USDS is a rebranded stablecoin Dai (DAI), which aims to maintain a value of $1. Sky also rebranded from Maker in August, and confusion over the change led co-founder Rune Christensen to suggest reverting to the original name, but Sky stayed put. To get Solana users to use the rebranded token, Sky is offering rewards to early adopters and stablecoin liquidity providers for various DeFi protocols. Kamino Finance users will receive $200,000 in weekly rewards for USDC/USDS liquidity providers, and $100,000 in weekly rewards for stablecoin suppliers.

Meanwhile, Drift Protocol stablecoin suppliers will also receive a 100,000 USDS reward. Those who provide USD-pegged assets to Save Finance will have the opportunity to receive a monthly reward of $400,000.

The Sky team added that the protocol has a native integration through Wormhole’s Native Token Transfer (NTT) “enabling seamless USDS operations on Solana”.

USDS is the third-largest stablecoin by market cap, with a market cap of $5.3 billion, accounting for 2.8% of the market in a market dominated by Tether and USD Coin, which together account for 88% of the market.

DeFi on Solana has seen significant growth this year, with total value locked up 487% year-to-date to $8.34 billion, according to DefiLlama. However, Solana’s popularity has been driven primarily by memecoin speculation, as it is quick and cheap to create them on the network using launchers such as Pump.fun.

Solana DeFi growth so far this year. Source: Deflama

The former governance token Maker has lost 30% since its rebrand, when the protocol urged holders to convert to the new token Sky (SKY).

Adoption has been slow as the new SKY governance token is not yet listed for trading on exchanges.