Sky’s New Stablecoin USDS Jumped to $1 Billion Supply in Two Weeks

Sky, formerly MakerDAO, launched a new stablecoin called USDS which has been quickly climbing the ranks.

USDS’s total supply has surged to just over $1 billion since its Sept. 18 launch, ranking it as the 6th-largest stablecoin by market capitalization.

The stablecoin’s growth is an early validation of MakerDAO’s founder Rune Christensen's effort to overhaul MakerDAO, with the goal to reach a more mainstream audience.

Much of USDS’s growth comes from startup Ethena Labs. The firm behind the controversial stablecoin USDe on Oct. 1 added $400 million in USDS to its balance sheet in what appears to be a move to diversify its collateral. Ethena has $2.5 billion in total value locked (TVL).

DAI was initially only backed by ETH, which made it more censorship-resistant but harder for it to scale. MakerDAO started adding collateral types, including fiat-backed stablecoins and real-world assets, which helped DAI to grow but caused it to stray from its original mission and alienate some of its supporters.

USDS is purposely built so that it can more easily scale.

After upgrading the protocol to Sky, users have been able to swap DAI for USDS, with nearly $500 million swapped since the rebrand. DAI’s total supply sits at $5.8 billion, down $67 million today, according to a Sky dashboard.

Sky also launched a new governance token called SKY to replace MakerDAO’s MKR. The SKY token hasn’t seen as much interest, with users swapping only $69,000 MKR “upgraded.”