SKY is a native currency of the decentralized Sky Protocol (prev. MakerDAO). It is an upgrade of MKR - the governance token on the now-rebranded MakerDAO. ^[1]

Overview

In August 2024, MakerDAO rebranded to Sky and announced the names of its upgraded tokens, SKY and USDS which holders of its old tokens, MKR and DAI, can switch to. The release of the names followed its confirmation of upgrades to its token ecosystem. ^[1][4]

In September 2024, SKY was launched, joining MKR to power the open and sustainable Sky ecosystem. By upgrading MKR to SKY at a rate of 1:24,000, users can interact with the Sky ecosystem. ^[1][2]

While only MKR can still be used to vote onchain for governance proposals, decentralized SKY token voting is planned for the future. Users will also be able to Activate and Seal their SKY tokens to accumulate Activation Token Rewards. With the Sky Protocol, users can receive rewards without giving up control of their supplied assets. Upgrading is optional. ^[1][2][3]

Utility

Although MKR is still being used as a governance token in the Sky ecosystem, the SKY token is planned for governance use in the future. Through a voting process, SKY holders would determine the business logic and risk management parameters for each collateral asset and type of CDP. ^[2]

The governance voting process is set to follow a continuous approval voting method, enabling holders to cast votes for multiple proposals using their MKR holdings. They would also have the flexibility to create new proposals or modify their existing votes at any time. ^[2][3]

Ongoing $75M Token Buyback Program

Since late February 2025, Sky has executed a systematic buyback of its SKY token using its own USDS stablecoin. Over six months, the protocol has spent a total of $75 million on repurchasing 73 million SKY tokens to reduce circulating supply and support price stabilization. ^[6]

Market Impact

• Since the buyback launch, SKY's price has increased by approximately 8%, rising from ~6.3 cents to over 6.85 cents.
• In August alone, Sky bought back 73 million SKY for 5.5 million USDS.
• The token saw a brief surge to 9.6 cents in late July, nearing its all-time high (just above 10 cents), before sliding again with broader market fluctuations. ^{[6] [7]}