Sky Launches USDS Stablecoin on Solana to Expand DeFi Presence

Sky, previously known as Maker, has officially launched its USDS stablecoin on the Solana blockchain, marking the introduction of the network's first major DeFi-native stablecoin. This move is part of Sky's broader strategy to boost Solana's decentralized finance (DeFi) ecosystem, focusing on increasing liquidity and total value locked (TVL) on the network’s leading DeFi platforms.

USDS Launches to Support Solana’s Growing DeFi Ecosystem

The November 19 announcement highlights that USDS is designed to enhance lending, borrowing, and trading within Solana’s DeFi space. The launch is expected to play a key role in strengthening Solana's TVL, which has seen significant growth since the start of the year. According to data from DefiLlama, Solana’s TVL has surged from $1.4 billion on January 1 to over $8.3 billion as of November 2024. In addition, the network recently hit an all-time high in daily trading volume, reaching $7.14 billion.

Sky aims to leverage this momentum by offering a stablecoin solution that aligns with Solana's robust ecosystem, including its consumer apps, high-performance technology, and composability. The integration of USDS onto Solana is supported by Wormhole's Native Token Transfer (NTT) technology, enabling the stablecoin to function across both Solana and Ethereum without the need for wrapped tokens. This ensures a unified supply of USDS across the two blockchains.

Incentives to Drive Early Adoption

As part of the launch, Sky is offering a variety of incentives to attract users and liquidity providers to USDS on Solana. Kamino Finance users can earn 200,000 USDS weekly by providing liquidity to USDC/USDS pairs, with an additional 100,000 USDS available for stablecoin suppliers. Drift Protocol users who supply 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.

SkyLink and Cross-Chain Expansion

Looking ahead, Sky plans to introduce SkyLink, a cross-chain bridge designed to connect USDS with sUSDS, a savings-focused version of the stablecoin. This development, which is subject to governance approval, will enhance the cross-chain operability of USDS and further extend its reach across multiple blockchain ecosystems.

USDS: A Major Player in the Stablecoin Market

Launched in September 2024, USDS is a dollar-pegged stablecoin and a rebrand of the original Dai stablecoin. As of now, it is the third-largest stablecoin by market capitalization, valued at $5.23 billion. USDS competes directly with other major stablecoins, such as Tether's USDT and Circle's USDC, which together dominate over 90% of the stablecoin market, valued at $184.7 billion, according to DefiLlama.

Sky's Ongoing Evolution

Sky, which attempted to revert to its original Maker branding amid confusion over its rebrand, continues to evolve as it seeks to solidify its position in the rapidly expanding DeFi space. While the proposal to return to the Maker name was recently rejected, the launch of USDS on Solana signals Sky’s ongoing commitment to growing its DeFi footprint and improving liquidity across multiple blockchains.