What happened to MakerDAO and MKR?

MakerDAO rebranded to Sky in September 2024. MKR is being replaced by SKY at 24,000 SKY per MKR, and DAI has an upgraded successor called USDS. MKR can still be converted, but a late-upgrade penalty applies and grows over time (4% as of September 2026).

How do I convert MKR to SKY?

Through the official Sky upgrade flow, which swaps each MKR for 24,000 SKY minus the current late-upgrade penalty. Binance, Kraken and Coinbase have delisted MKR, so exchange conversion is no longer the easy path it once was.

What is the difference between USDS and DAI?

Both are dollar stablecoins issued by the same protocol and can be swapped 1:1. USDS is the newer version and earns the Sky Savings Rate. In September 2026 about $6.5 billion of USDS and $5 billion of DAI were outstanding.

Stars are semi-independent units created under Sky's Endgame plan, each focused on a specific business with its own token and governance. Spark, which runs lending and yield products, was the first.

Sky (SKY) Explained: How It Works, Use Cases

What SKY is

Sky is the protocol that used to be called MakerDAO, the team that created DAI, the original decentralized over-collateralized stablecoin. MakerDAO launched in 2017 and DAI went live that December. In September 2024 the protocol rebranded to Sky and introduced two new tokens: SKY, which replaces MKR as the governance token at a rate of 24,000 SKY for every MKR, and USDS, an upgraded successor to DAI.

The old names have not fully disappeared. DAI still circulates alongside USDS, with a converter that swaps them 1:1 in either direction; in September 2026 roughly $6.5 billion of USDS and $5 billion of DAI were outstanding. MKR can still be upgraded to SKY, but holders who wait pay a penalty that grows over time (4% as of September 2026), and Binance, Kraken and Coinbase have all delisted MKR.

How it works

Users lock collateral (ETH, staked ETH, other crypto and tokenized real-world assets) in vaults and mint USDS or DAI against it, keeping the collateral above a minimum ratio or facing liquidation. Borrowers pay stability fees, and much of the protocol's reserve backing now sits in US Treasuries and other real-world assets. USDS holders can earn the Sky Savings Rate, which is funded from that revenue.

SKY holders vote on protocol parameters: which collateral is accepted, what fees apply, how reserves are managed. Protocol surplus funds buybacks of SKY through the Smart Burn Engine. The Endgame plan also spins off semi-independent units called Stars, each with its own token; Spark, the lending and yield arm, was the first.

Use cases

USDS and DAI are used across DeFi as stable units of account, as lending collateral and in trading pairs, especially by users who want a dollar asset not issued by a single company. SKY is used for governance voting and can be staked for rewards. Holding SKY also means bearing risk: if collateral losses outrun liquidations, the protocol can issue new tokens to cover the shortfall, diluting holders.

Tradeoffs and criticism

The governance token is a backstop, not just a vote. In the March 2020 "Black Thursday" crash, MKR was minted and sold to cover bad debt after vault liquidations failed. The Endgame restructuring and the MKR-to-SKY switch split the community, and the growing late-upgrade penalty and exchange delistings leave stragglers still holding MKR in a worse position. Heavy use of US Treasuries and USDC-style assets as backing makes the system more efficient but less decentralized than the original ETH-backed design.

Where to track SKY

See Dai for the stablecoin side, stablecoin for the category and DeFi for context.

Sky SKY

What SKY is

How it works

Use cases

Tradeoffs and criticism

Where to track SKY