# Sky Dollar (USDS): MakerDAO's Rebranded Stablecoin

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**Publisher:** Decentralized Finance Publication (https://decentralized-finance.io)
**Author:** Decentralized Finance editorial team
**Reviewed by:** Kaiser Khan, Editor in Chief
**Category:** Stablecoins
**Updated:** Apr 19, 2025
**Trust:** Independent, ad-free editorial research. No display advertisements, no paid protocol coverage, no affiliate-driven rankings.

## Summary

USDS is the successor to DAI, issued by Sky Protocol (formerly MakerDAO), with $8.43B in circulation and a yield-sharing model that pays holders the Sky Savings Rate directly on-chain.

Sky Dollar (USDS) is the upgraded stablecoin issued by Sky Protocol, the rebranded version of MakerDAO — one of DeFi's oldest and most battle-tested protocols. Launched as part of MakerDAO's 'Endgame' strategic restructuring, USDS is designed to be a successor to DAI, with the same overcollateralized backing model but enhanced user-facing features including a native yield mechanism called the Sky Savings Rate (SSR). As of April 2025, USDS has $8.43 billion in circulation, making it the third-largest stablecoin globally.

## From DAI to USDS: The Sky Migration

MakerDAO's Endgame plan, approved by MKR governance in 2023, involved a comprehensive rebranding: the protocol became Sky Protocol, MKR governance token holders could convert MKR to SKY tokens, and DAI holders could convert DAI to USDS at a 1:1 rate through the Sky.money interface. The migration is optional — DAI continues to exist and function as before — but USDS holders gain access to features unavailable to DAI holders, primarily the Sky Savings Rate.

Users can also access USDS directly by trading USDC, USDT, ETH, or SKY through Sky Protocol's liquidity pools, without needing to go through the vault/CDP process that underpins DAI minting.

## The Sky Savings Rate

The Sky Savings Rate (SSR) is the primary differentiator between USDS and DAI. By depositing USDS into the SSR contract, users receive sUSDS (staked USDS) — a yield-bearing token that accretes value as protocol-generated interest accumulates. The SSR is funded by the interest paid by borrowers who mint USDS against collateral, distributing a portion of Maker/Sky protocol revenue directly to stablecoin holders.

This design mirrors the DAI Savings Rate (DSR) that MakerDAO introduced years earlier, but is positioned more prominently as a core product feature within the new Sky brand. The SSR rate is set by Sky governance and adjusts based on market conditions and protocol revenue.

## Collateral Backing and Risk Profile

Like DAI, USDS is backed by a diversified basket of collateral managed through Sky Protocol's vault system. Accepted collateral includes ETH, wstETH, WBTC, real-world assets (RWAs) such as tokenized US Treasuries, and stablecoins like USDC and USDT. The inclusion of RWAs has been a significant driver of protocol revenue, as real-world asset yields are passed through to the protocol and ultimately to USDS/DAI savings rate holders.

The protocol enforces overcollateralization ratios for each collateral type, and liquidations occur when positions fall below the minimum ratio, protecting the system's solvency.

## Protocol Data — USDS (Source: DeFiLlama)

The following metrics are sourced from DeFiLlama's stablecoin tracker. Data is approximate and subject to change.

- Market Cap: $8.43B
- Price: $1.00
- Total Circulating Supply: 8.43B USDS
- 7-Day Change: -3.28%
- 1-Month Change: +2.84%
- Largest Chain: Ethereum (~$7.93B)
- Other Chains: Base ($146M), OP Mainnet ($100M), Unichain ($100M), Arbitrum ($100M)
- Category: Crypto-backed (overcollateralized)
- Yield Mechanism: Sky Savings Rate (SSR) via sUSDS
- Predecessor: DAI (MakerDAO)

## Conclusion

USDS represents the evolution of DeFi's longest-running stablecoin experiment. By layering a native yield mechanism and a broader collateral base on top of DAI's proven overcollateralized model, Sky Protocol has created a stablecoin that competes with yield-bearing alternatives like sUSDe while maintaining the decentralization credentials that Maker built over eight years. With $8.43 billion in circulation and deep DeFi integrations inherited from DAI's decade of ecosystem building, USDS enters the market with structural advantages that newer stablecoins cannot easily replicate.

## Sources

- [USDS on DeFiLlama](https://defillama.com/stablecoin/sky-dollar): Live USDS market cap, chain breakdown, and circulating supply
- [Sky Protocol](https://app.sky.money/): Official Sky Protocol app — mint, save, and manage USDS

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