Sky, a decentralized finance (DeFi) lending platform, has proposed to finalize its upgrade from Maker by replacing the Maker (MKR) governance token with its own Sky (SKY) token and enabling staking for users. This proposal, submitted on May 1, could potentially take effect between May 15 and May 19, with a transition to a one-way upgrade from MKR to SKY, banning downgrades back to MKR. Sky co-founder Rune Christensen supported the proposal, highlighting it as a significant milestone expected to improve exchanges' adoption of SKY without concerns about liquidity fragmentation. The proposal also includes a 1% penalty for MKR holders who delay their upgrade starting September 18, with the penalty increasing over time. Additionally, staking rewards tied to the Sky Protocol's income will be available shortly after the governance contract upgrade. To mitigate manipulation risks during this transition, liquidations of SKY will be temporarily paused. Christensen emphasizes that completing the MKR to SKY transition is essential for achieving zero fixed costs for Sky by the end of 2025, enhancing benefits for SKY token holders.

Source 🔗