Sky’s USDS goes multichain with Solana launch

Sky, formerly known as Maker, has launched its USDS stablecoin on Solana to introduce the network’s “first major Defi-native stablecoin.”

According to a Nov 19 announcement, USDS is expected to enhance lending, borrowing, and trading on the network’s leading DeFi platforms, with the launch marking the first step in Sky’s strategy to “increase Solana’s DeFi liquidity and TVL.”

With USDS, Sky hopes to command a share of the growing decentralized finance market on Solana, which recorded an uptick in daily trading volumes and total value locked since the start of the year. According to DefiLlama, Solana’s TVL had grown from $1.4 billion on January 1 to over $8.3 billion when writing, while its daily trading volume recently hit an all-time high of $7.14 billion.

“Sky’s vision is aligning with Solana’s strong ecosystem of consumer apps, composability, and high-performance technology,” the announcement added.

The integration of USDS on Solana is supported by Wormhole’s Native Token Transfer, which allows the stablecoin to become natively multichain, available on both Solana and Ethereum without the need for wrapped tokens, ensuring a unified supply across chains. NTT also enables Sky to bridge its governance token, SKY, to the Solana network.

As a part of the launch, Sky is incentivizing early adoption by offering rewards for users and liquidity providers engaging with USDS across four Solana DeFi protocols.

Users of Kamino Finance will receive 200,000 USDS weekly for providing liquidity to USDC/USDS pairs, along with an additional 100,000 USDS for stablecoin suppliers. Drift Protocol users supplying USDS will be eligible for 100,000 USDS in weekly rewards, while Save Finance participants can earn a share of 400,000 USDS distributed monthly for their contributions to stablecoin liquidity.

Sky also plans to introduce SkyLink, a cross-chain bridge connecting USDS and sUSDS, its savings-focused version of the stablecoin. This rollout, subject to governance approval, is expected to expand cross-chain operability for USDS holders.

As a dollar-pegged stablecoin, USDS was launched in September and is a rebrand of the Dai stablecoin. Currently, it is the third-largest stablecoin by market capitalization, valued at $5.23 billion, competing with major players like Tether’s USDT and Circle’s USDC. 

Collectively, the two stablecoins account for more than 90% of the overall stablecoin market value, which stands at $184.7 billion per DefiLlama.

In related news, Sky recently attempted to revert to the Maker branding following confusion around its rebranding, but the proposal was rejected.