One year as Sky: capital formation vs. adoption – who’s winning?
A year after MakerDAO’s rebrand, Sky pitches a simple idea: USDS as the super‑safe layer, Stars to take risk and generate yield. The machine works – but the scoreboard is messy. USDS hasn’t beaten DAI, incentives are expensive, and reporting is confusing. Here’s what’s working, what isn’t, and what to watch next.
A year after MakerDAO rebranded to Sky, the protocol runs a multi‑billion stablecoin stack split between legacy DAI and successor USDS. The idea for users is simple: park dollars in USDS (the “super‑safe” layer) while independent “Stars” take risk and generate yield. Year one delivered structure and better margins – but adoption is mixed and the incentive bill is heavy. These takeaways draw on the Aug. 27, 2025 Crowdcast session, “Sky Community Calls – Season 2: Overhaul Q&A – Ecosystem Entities Grant,” featuring Rune Christensen, Sky co‑founder and longtime MakerDAO co‑founder/architect, and on critic notes from PaperImperium.
What Sky built vs. what users see
Sky’s pitch in plain English: USDS is the safest slice in the stack; Stars (e.g., Spark, Grove) are separate teams that take risk to earn yield. That yield is meant to make holding USDS worthwhile. Think “Savings” as a simple deposit‑style product and token‑reward farms as points/reward programs you’ve seen across DeFi.
On the ground, demand leans on Savings and token‑reward farms – together driving roughly 90% of USDS activity on the weekly snapshot discussed in the call. Big funds stepped in; the long tail of small wallets was softer. In the same snapshot, USDS was ~$3.79B (47.8%) while DAI was ~$4.13B (52.2%), and DAI has been quietly rebounding. Translation: the machine runs, but USDS hasn’t clearly outrun DAI.
The capital‑formation bet, with one simple example
Spark is the flagship case: Sky seeded it with ~$25M and claims it catalyzed ~$390M of total value. If Sky can repeat that across multiple Stars without blow‑ups, risk‑adjusted returns on USDS (more yield for the same or less risk) should improve, attracting institutional and “mercenary” capital (large, yield‑sensitive holders) that parks where the payout for the risk taken is best. The trade‑off: Stars launch methodically; quality > speed.
Money talk without jargon: profits vs. capital transactions
Sky’s finances look contradictory because different tools answer different questions. Steakhouse reports on what actually happened – cash in, cash out – so its view is backward‑looking and conservative, showing roughly $8M profit in Q2 alongside stronger year‑over‑year margins. The info.sky dashboard is the opposite: it projects a run‑rate from recent trends and deliberately strips out large capital transactions – things like seeding Stars or big internal transfers – so the forward number isn’t inflated by one‑offs. A third set of documents breaks out expenses and one‑time items so the community can audit where funds went. As Rune Christensen put it, “We have three different ways of measuring this stuff, and none… agree.”
His follow‑up matters for readers:
By not counting capital transactions, we’re actually lowering profits.
In short, don’t confuse investments with everyday earnings – but users still deserve a single, consistent scoreboard they can track month to month.
The critics’ file: costs, incentives, and liquidity
PaperImperium’s critique in plain terms: Sky has spent heavily to build and promote USDS – and still spends a lot to keep balances via savings and farms. He estimates the build at roughly $44M, and says the ongoing savings bill runs around $100M a year, with additional farm rewards on top. Despite that outlay, USDS still trails DAI and lacks deep CEX access (not listed on some majors; limited inventory elsewhere).
His verdict: the incentives‑first strategy isn’t delivering dominance, so Sky should reassess and refocus on product and liquidity.
Sky’s counterpoints – and what would actually impress users
Sky counters that the engine is getting healthier even if the dashboard is messy. Margins improved year over year; recent simplification – funding dedicated foundations and separating big capital moves from day‑to‑day results – should make profits steadier and easier to read. Stars are designed to match risk to team quality, which is why token launches won’t be rushed. A future staking redesign (with an unstaking period and helper flows like auto‑compounding) aims to make holding feel less like a farm and more like a long‑term position for holders.
For everyday users, real progress would look tangible: less reliance on rewards to keep dollars parked in USDS; a clear, unified profit metric the community can follow without decoding; broader liquidity and listings where retail actually trades; and Stars that bring in new users rather than simply recycling capital inside the Sky universe.
Bottom line. Sky has built a working engine and improved margins, but USDS hasn’t escaped the gravity of incentives or overtaken DAI. To win beyond whales, Sky needs clearer reporting, deeper everyday access, and Stars that attract new users – not just rotate capital inside the ecosystem.
What to watch next
Through Q4, watch whether USDS gains share against DAI without dialing incentives back up; whether Sky lands on one profit scoreboard that reconciles Steakhouse, dashboards, and expense reports; whether new Stars add users and durable flows without blow‑ups; and whether the staking/UX overhaul gives holders real skin in the game and easier compounding.
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