USDS

USDS is the US dollar stablecoin of Sky, the upgraded successor to DAI, convertible 1:1.

USDS is a stablecoin that aims to stay worth one US dollar. It is issued by the Sky Protocol, the new name of MakerDAO since August 2024, and launched on 18 September 2024 as the upgraded version of DAI. Any DAI can be swapped for USDS and back at a fixed 1:1 rate with no fee, so the two tokens share one system; SKY, which replaced the MKR token at 24,000 SKY per MKR, is used to govern it.

No company holds a dollar in a bank for each USDS. Instead the protocol holds more collateral than it has USDS and DAI outstanding: USDC in its Peg Stability Module, crypto locked in vaults by borrowers who pay a stability fee, real-world assets such as tokenised Treasury funds, and capital that affiliated "Sky Agents" such as Spark and Grove place into lending, credit and fixed-income strategies. Sky reported $12.3 billion of collateral and $107 million of gross revenue for the second quarter of 2026.

Holders can deposit USDS into the Sky Savings Rate by converting it to sUSDS, which grows in value at a rate set by Sky governance (3.60% a year in September 2026) and paid out of protocol surplus. More than half of all USDS was held as sUSDS at the end of June 2026. Other options pay SKY tokens as rewards or fund loans to SKY stakers (stUSDS).

Unlike DAI, the USDS contract can be upgraded by Sky governance. When USDS was announced, press reports said it would have a freeze function; the code deployed today has no function to freeze holders' balances, but an upgrade could add one. About 9.8 billion USDS were in circulation on 27 September 2026, making it the 16th-largest crypto asset on CoinGecko, on Ethereum, Base, Arbitrum and Solana.