Latest Sky (SKY) News Update

By CMC AI
30 September 2025 04:22PM (UTC+0)

What is the latest news on SKY?

TLDR

Sky doubles down on Solana DeFi and tokenized assets while tightening migration rules. Here are the latest updates:

  1. Keel Launches $2.5B Solana Strategy (30 September 2025) – Sky deploys USDS reserves to boost Solana's DeFi and RWA ecosystem.

  2. Delayed SKY Conversion Penalty Vote (19 September 2025) – Governance proposes 1% fee for unupgraded MKR holders, escalating quarterly.

  3. SKY Listings Expand on Binance, BloFin (17 September 2025) – Enhanced liquidity as exchanges integrate SKY into Earn, Margin, and spot markets.

Deep Dive

1. Keel Launches $2.5B Solana Strategy (30 September 2025)

Overview:
Sky’s new Solana-focused autonomous unit, Keel, aims to deploy up to $2.5B of USDS reserves into Solana DeFi protocols (Kamino, Jupiter, Raydium) and tokenized real-world assets. This follows Spark’s $10B TVL success on Ethereum and Grove’s $1B institutional credit allocations.

What this means:
This is bullish for SKY as it diversifies revenue streams beyond Ethereum, taps into Solana’s growing DeFi ecosystem (~$4B TVL), and aligns with the "Endgame" vision of decentralized capital allocation. However, Solana’s volatility and technical risks could challenge yield stability.
(CoinDesk)

2. Delayed SKY Conversion Penalty Vote (19 September 2025)

Overview:
Sky governance introduced a 1% quarterly penalty (starting 22 September) for MKR holders delaying conversion to SKY, aiming to complete the rebrand from MakerDAO. Only 81% of MKR has migrated so far, leaving ~$316M worth pending.

What this means:
This is neutral-to-bearish short-term, as penalties may pressure remaining MKR holders to sell, but bullish long-term by simplifying governance. The 1:24,000 conversion ratio remains unchanged, though delayed upgrades risk dilution.
(The Block)

3. SKY Listings Expand on Binance, BloFin (17 September 2025)

Overview:
Binance added SKY to Earn, Margin, and Convert services, while BloFin launched SKY/USDT spot trading. This follows Coinbase’s July listing, broadening institutional and retail access.

What this means:
Bullish for liquidity and adoption, as top-tier exchanges reduce friction for SKY holders. However, SKY’s price remains -19% YTD despite these integrations, suggesting macro headwinds outweigh listing optimism.
(Binance Square)

Conclusion

Sky is aggressively expanding into Solana’s RWA/DeFi verticals and tightening governance to phase out MKR, but mixed price action reflects skepticism about execution risks. Will Keel’s Solana bet offset slowing USDS growth (+8% MoM vs. +29% YoY)?

What are people saying about SKY?

TLDR

Sky's community orbits around buybacks and ecosystem growth, with traders eyeing technical rebounds. Here’s what’s trending:

  1. Aggressive token buybacks absorbing 3.28% of supply

  2. Exchange listings fueling speculative interest

  3. MKR conversion urgency ahead of September penalties

Deep Dive

1. @SkyEcosystem: Buyback Momentum Accelerates 🔥 bullish

"Sky Protocol spent 1.39M USDS last week to buy back 17.32M SKY – 1.12B tokens repurchased to date."
– @SkyEcosystem (253K followers · 56K impressions · 2025-08-18 14:37 UTC)
View original post
What this means: Sustained buybacks (3.28% of supply removed) could tighten liquidity, though SKY’s -17% 60d performance suggests macro headwinds offset this support.

2. @mkbijaksana: Technical Rebound In Play 📈 bullish

"SKY formed bullish engulfing candle – targeting 0.088 if 21 EMA holds."
– @mkbijaksana (12.5K followers · 56K impressions · 2025-08-27 06:52 UTC)
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What this means: Traders see potential recovery from oversold conditions (RSI 37), though -4.77% weekly drop questions immediate upside conviction.

3. @PhemexR: Russian Market Expansion 🇷🇺 neutral

"Новый листинг SKY – первый токенизированный CLO в DeFi."
– @PhemexR (89K followers · 21K impressions · 2025-09-18 09:07 UTC)
View original post
What this means: Phemex’s Russian listing expands access but coincides with SKY’s -19% 90d decline, testing institutional appetite for rebranded MakerDAO assets.

Conclusion

The consensus on SKY is mixed – bullish buyback mechanics and technical setups clash with bearish credit risks (S&P’s B- rating) and delayed MKR conversions. Watch the MKR-to-SKY upgrade rate (56% complete as of August) ahead of September 18 penalty triggers, which could force remaining $316M MKR positions into SKY.

What is the latest update in SKY’s codebase?

TLDR

Sky’s codebase advances focus on governance upgrades and ecosystem scalability.

  1. Core Simplification Proposal (24 July 2025) – Streamlines protocol architecture to accelerate third-party integrations.

  2. MKR-to-SKY Migration Progress (5 August 2025) – 56% completion ahead of penalty activation on 18 September.

  3. Staking Engine Integration (22 May 2025) – Ties rewards directly to protocol revenue performance.

Deep Dive

1. Core Simplification Proposal (24 July 2025)

Overview: Aims to reduce technical debt by modularizing Sky’s core infrastructure, enabling faster onboarding of ecosystem “Stars” (sub-projects).

The proposal replaces legacy MakerDAO-era code with lightweight governance hooks, cutting smart contract gas costs by ~18% in testnet simulations. Developers emphasize backward compatibility for existing Stars like Spark and Grove.

What this means: This is bullish for SKY because simpler code could attract more builders, expanding utility for USDS and stakers. However, migration risks temporary governance delays during implementation.
(Source)

2. MKR-to-SKY Migration Progress (5 August 2025)

Overview: Over 1.1B SKY (3.2% of supply) bought back via automated mechanisms tied to protocol revenue.

The upgrade module enforces a 1 MKR = 24,000 SKY conversion ratio until 18 September, after which delayed upgrades face 1% quarterly penalties. Code audits confirmed the penalty schedule’s immutability.

What this means: Neutral short-term as buybacks offset sell pressure, but bullish long-term if migration completes smoothly. The penalty system risks alienating legacy MKR holders who miss deadlines.
(Source)

3. Staking Engine Integration (22 May 2025)

Overview: Replaced fixed APY with dynamic rewards scaled to Sky’s quarterly earnings (currently ~$230M annualized).

Smart contracts now auto-compound 50% of stakers’ USDS rewards into SPK tokens from partner Stars, creating cross-ecosystem incentives.

What this means: Bullish because aligning rewards with revenue incentivizes long-term holding, though complex tokenomics may confuse casual users.
(Source)

Conclusion

Sky’s code shifts toward sustainable governance and institutional DeFi readiness, but success hinges on seamless MKR migration by September. Will the penalty-driven upgrade model set a precedent for future DAO transitions?

What is next on SKY’s roadmap?

TLDR

Sky's roadmap focuses on governance upgrades and ecosystem expansion:

  1. Delayed Upgrade Penalty Ramp-Up (Dec 2025) – 1% penalty increase for MKR→SKY conversions.

  2. Powerhouse Spin-Off Finalization (Q4 2024) – Transition to autonomous ecosystem actor.

  3. Core Simplification Process (2025) – Streamlining governance to accelerate growth.

  4. Institutional DeFi Expansion (2025) – Bidding for Hyperliquid’s USDH stablecoin.

Deep Dive

1. Delayed Upgrade Penalty Ramp-Up (Dec 2025)

Overview:
A 1% quarterly penalty for delayed MKR→SKY conversions begins on September 18, 2025, escalating every three months. By December 2025, the penalty will rise to 2%, incentivizing remaining MKR holders to upgrade (Sky Protocol Docs).

What this means:
This is neutral-to-bearish for SKY in the short term, as forced conversions could create selling pressure. However, it strengthens governance centralization by phasing out MKR.


2. Powerhouse Spin-Off Finalization (Q4 2024)

Overview:
Powerhouse, Sky’s decentralized operations platform, aims to become an independent ecosystem actor. Key deliverables include legal entity setup (50% complete), tokenomics design (15% complete), and community growth initiatives (Sky Fusion Roadmap).

What this means:
This is bullish long-term, as a functional spin-off could attract external projects to Sky’s infrastructure. However, delayed tokenomics finalization poses execution risks.


3. Core Simplification Process (2025)

Overview:
Proposed in July 2025, this initiative seeks to reduce bureaucratic overhead in Sky’s governance model, potentially accelerating the launch of new "Stars" (sub-ecosystems like Spark and Grove) (Sky Ecosystem tweet).

What this means:
This is bullish if implemented successfully, as faster decision-making could improve USDS adoption. Watch for voter turnout in upcoming governance polls.


4. Institutional DeFi Expansion (2025)

Overview:
Sky is bidding to issue Hyperliquid’s USDH stablecoin, offering 4.85% yields and $2.2B liquidity. A decision is expected post-September 2025 (Cointelegraph).

What this means:
This is bullish for USDS utility, potentially onboarding institutional capital. Failure to win the bid could redirect resources to existing Stars like Grove.


Conclusion

Sky’s roadmap balances penalty-driven tokenomics with ecosystem growth, targeting both retail and institutional adoption. The December penalty hike and Hyperliquid bid outcomes will test SKY’s resilience. Can Sky’s Stars outcompete standalone DeFi protocols in revenue generation?

CMC AI can make mistakes. Not financial advice.