MakerDAO’s rebranding to Sky has diehard decentralized finance fans worried, but expert claims the move was necessary for the platform.
On Aug. 27, MakerDAO founder Rune Christensen announced that the DeFi platform will rebrand as Sky. The protocol’s Dai (DAI) stablecoin will be upgraded to Sky Dollar (USDS) and its governance token, Maker (MKR), will transition to SKY.
One thing made DeFi fans worried; the freeze function that comes with the USDS stablecoin.
“It’s less about centralization and more about being compliant,” Sean Lee, co-founder and chief strategy officer at IDA, told crypto.news.
Lee, whose company is also launching a Hong Kong-regulated stablecoin, says that if a stablecoin doesn’t have a freeze function, it will be used for illegal activities.
“That becomes a very big deal for anyone that’s hoping for their stablecoin to have the right level of adoption from the user, but at the same time not be on the radar of regulators.”
Lee added.
The rebranding to Sky with the new freeze function could help USDS have a “global reach.”
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Less believes that the centralization of SKY and USDS would depend on how the tokens are issued, how they are controlled, and the way they “work within protocols.”
In May, Christensen hinted at launching a new stablecoin for the MakerDAO ecosystem, which is now USDS, and a separate stablecoin that will be fully decentralized, called PureDai. The new token will be pegged to the US dollar, but will not be permanently connected to the DeFi lender.
Reconciling the two opposing paths for Decentralized Stablecoins
From the moment Dai started scaling, it has been straddling two worlds.
One world is the culture of pure decentralization as introduced with Bitcoin. The other is the desire to fulfill the original purpose of Dai,…
— Rune (@RuneKek) May 15, 2024
However, PureDai is not to be released anytime soon as Christensen said the stablecoin “will be available after a few years.”
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