Sky Savings Rate Onchain

As-of October 4, 2026 — identification

• Name/category: Sky Lending is the DeFiLlama label for Sky Protocol’s over-collateralised CDP/lending system, historically MakerDAO. It issues/uses USDS against collateral and is categorized as CDP, not a conventional pooled lender.
• Website: https://app.sky.money/ (provided identifier; consistent with Etherscan’s linked project domain). Docs: https://docs.sky.money/; Sky’s terms describe the underlying system as autonomous, non-custodial smart contracts.
• Launch date: The underlying Maker/Dai system launched in December 2017; the Sky rebrand and USDS/SKY launch occurred in September 2024. Therefore, “Sky Lending launch date” is ambiguous.
• Chains: Contradiction: the supplied scope lists Arbitrum, Ethereum, OP Mainnet and Unichain, but current DeFiLlama data identifies Sky Lending as Ethereum-only. Multi-chain deployment and exposure split: Not verifiable as of October 4, 2026.
• Native token: SKY governance token; USDS is the stablecoin and sUSDS the savings-rate token.
• Addresses: Official Sky repository lists Ethereum addresses SKY: 0x56072C95FAA701256059aa122697B133aDEd9279, USDS: 0xdC035D45d973E3EC169d2276DDab16f1e407384F, and sUSDS: 0xa3931d71877C0E7a3148CB7Eb4463524FEc27fbD. SKY is explorer source-verified on Etherscan. However, the required two-source cross-check including Dune, plus complete core-module address verification, is Not verifiable as of October 4, 2026 because Dune is unavailable. Fork lineage
• Is it a fork? No conventional third-party fork. It is the rebrand/evolution of MakerDAO/Maker Protocol, retaining the Dai Stablecoin System lineage.
• Changes versus upstream Maker: DAI→USDS, MKR→SKY migration/conversion, new savings/reward products, and additional cross-chain infrastructure; the core collateralized-debt architecture remains Maker-derived.
• Audits: Yes—ChainSecurity reports cover Sky smart contracts and cross-chain helpers.
• Malicious-modification history in similar forks: Not verifiable as of October 4, 2026; no reliable, protocol-specific evidence was located within the search budget.

Sky Lending appears to be a real, active product interface rather than a static marketing-only landing page: DeFiLlama tracks it as a lending protocol and its protocol pages include live yield/pool data, while Sky’s own legal/docs pages explicitly describe an app interface that lets users interact with Sky Protocol and other permissionless protocols. However, live deposit/withdrawal functionality, broken-link status, template/fake-metric checks, and any open API for the Sky app itself are not verifiable as of 2026-10-04 from the evidence available here. The earlier finding that the protocol page looked like a genuine product page still stands, but the direct web evidence remains thin, so claims about full app maturity beyond “real portal exists” should be treated cautiously.

Open API: not verifiable as of 2026-10-04. The evidence found only supports that DefiLlama exposes APIs for its own analytics platform; it does not confirm a public Sky Lending API.

• Real portal vs landing: real portal likely, not pure brochure.
• Live deposits/withdrawals: Not verifiable as of 2026-10-04.
• Docs/UX quality: Not verifiable as of 2026-10-04.
• Broken links / template signs / fake metrics: Not verifiable as of 2026-10-04.
• Open API: Not verifiable as of 2026-10-04.

Sky Lending has an active bug bounty program on Immunefi. It was listed as live since 2022-02-10. The published maximum payout is USD 10,000,000.

For critical smart-contract bugs, the reward is 10% of the funds directly affected, capped at USD 10,000,000, with a minimum reward of USD 150,000. Other critical theft cases can pay USD 50,000, and website/application critical loss cases can pay USD 100,000 when they cause direct loss without user action. The program requires a PoC, and the scope covers defi/cdp/lending/staking assets.

Public program pages do not disclose any paid bounty totals or incident outcomes, so results are Not verifiable as of 2026-10-04.

Assessment: elevated, multi-layered dependency/counterparty risk; no verified improvement since the prior review.

• Oracles/manipulation: Core collateral pricing depends on Chronicle and Sky’s Oracle Security Module (OSM), normally imposing approximately a one-hour delay. This mitigates some flash-crash risk but creates stale-price, freeze, outage, and delayed-liquidation risk; Sky’s documentation also notes implementation details under which the effective interval can be shorter than one hour.
• Cross-chain rate/oracle dependency: The SSR oracle uses authorized cross-chain messaging plus Chainlink and Balancer rate providers on Arbitrum, OP Mainnet, and Unichain. A compromised provider, receiver/authentication layer, stale Ethereum-sourced update, or chain outage could misprice sUSDS/USDS conversion.
• Bridges: Sky’s Ethereum–Solana USDS bridge migrated from Wormhole to LayerZero V2; the migration introduces bridge-message, upgrade-authority, rate-limit, and operational-downtime dependencies. The cited audit confirms privileged bridge/governance roles and the migration architecture.
• Stablecoin/RWA/issuer risk: USDS/DAI reserves include USDC, crypto assets including ETH/staked ETH, and RWAs such as U.S. government bonds. S&P rated USDS/DAI stability 4—Constrained, highlighting specialized-RWA credit/liquidity risk, governance concentration, and potential USDC contagion.
• Prime-agent/counterparty concentration: S&P reported that, by September 2026, Spark, Grove, Obex, and Osero represented approximately 65% of Sky’s consolidated assets backing USDS. This is an off-chain analytical estimate, not an on-chain verification.
• Custodians, CEX/MM exposure, exact RWA SPVs, LST/restaking composition, and exposure by the four requested chains: Not verifiable as of October 6, 2026. Dune was unavailable, so no exact maximum exposure percentage or chain allocation is asserted. Failure scenarios: oracle corruption/staleness → bad liquidations; bridge compromise or paused messaging → cross-chain insolvency/illiquidity; USDC depeg or RWA custodian/issuer failure → USDS depeg; Prime-agent insolvency or withdrawal freeze → impaired backing and redemption liquidity. Contradiction / evidence gap: Published allocation percentages and reserve claims cannot be reconciled to raw on-chain balances in this run; the gap remains unresolved. Dependency failure active: Not verifiable as of October 6, 2026. Maximum exposure: Not verifiable as of October 6, 2026.

Sky Lending is organized as a non-custodial smart-contract system: Sky’s legal docs state the services are non-custodial, that the operator does not hold or custody user assets, and that users alone control their wallets and can withdraw/redemptions onchain. Independent coverage also describes Sky as non-custodial and says users can redeem anytime or withdraw collateral when position rules allow, which supports that withdrawals are not generally paused. Asset segregation is only partially verifiable: the available evidence supports self-custody via protocol contracts, but it does not conclusively establish whether user assets are held in fully segregated accounts versus pooled within protocol contracts, so that remains not verifiable as of 2026-10-06.

Assessment — as of October 4, 2026 Sky’s published code indicates a governance-controlled privilege model, rather than a single operational custody key:

• Core privileged actions are generally executed through governance “executive spells.” Voting selects an authorized proposal, which is then scheduled through the Pause/Governance Security Module (GSM). Sky’s current executive library enforces a minimum 12-hour governance delay for ordinary actions.
• The governance authority is represented by contracts such as the Chief/governance voting system and the Pause Proxy. A keeper may monitor votes and schedule or execute an already-approved spell, but this is an operational role—not the source of ultimate authority.
• Emergency spells can bypass the normal GSM delay for rapid incident response. This creates a distinct emergency-control risk that must be assessed separately from ordinary governance.
• Some newer Sky subsystems use delegated roles, facilitator multisigs, operators, rate limits, and timelocks. These controls are subsystem-specific and should not be assumed to govern every Sky Lending contract. > Key limitation / unresolved finding: The available evidence does not establish the actual key holders, multisig addresses and thresholds, signer identities, proxy-admin ownership, emergency guardians, or timelock parameters for the Sky Lending deployments on Ethereum, Arbitrum, OP Mainnet, and Unichain. It also does not prove that the documented Sky governance architecture is identically deployed on each chain. Not verifiable as of October 4, 2026 for chain-specific key custody and administration. Accordingly, the protocol should be treated as having material governance and privileged-key risk, with decentralization, signer concentration, upgrade authority, and emergency-control exposure unresolved until deployment addresses and current on-chain authorities are mapped.

As of October 6, 2026 — Smart Contract & Admin Risk Scope / chain coverage. Sky Lending appears to be primarily the Ethereum Maker/Sky CDP system. Known Ethereum components from the prior verified map: Chainlog 0xdA0Ab1e0017DEbCd72Be8599041a2aa3bA7e740F; GSM/Pause 0xbE286431454714F511008713973d3B053A2d38f3; DSPauseProxy 0xBE8E3e3618f7474F8cB1d074A26afFef007E98FB; SKY Chief V3 0x929d9A1435662357F54AdcF64DcEE4d6b867a6f9; legacy Chief V2 0x0a3f6849f78076aefadf113f5bed87720274ddc0; Vat 0x35D1b3F3D7966A1DFe207aa4514C12a259A0492B. The Chainlog API currently exposes an active Ethereum release, but no active Arbitrum, OP Mainnet, or Unichain deployment was established. Verification / administration. Dune MCP was unavailable; therefore proxy-admin events, implementation slots, current auth/owner/emergency roles, renunciation, and on-chain timelock delay are Not verifiable as of October 6, 2026.

Do not treat protocol documentation as proof of current role state. Architecture / controls. Chief/governance → DSPause (delegatecall proxy + delay) → DSPauseProxy → authorized spells/modules → Vat / adapters / oracles The Pause design requires scheduled plans, code-hash matching, and elapsed delay; execution may be permissionless after scheduling. The Vat itself is documented as immutable, but any auth-authorized module has root-like power: it can alter collateral accounting, mint unbacked Dai, or potentially steal collateral. Worst case. Compromise of governance authority, an authorized Vat module/adapter, oracle controls, or a trusted cross-chain receiver could cause collateral seizure, unbacked stablecoin issuance, bad liquidations, or system freeze. Cross-chain receivers and bridge infrastructure are explicitly trust assumptions.

Users may have an exit window only if the Pause delay is active and liquidity remains; this was not measured on-chain. Audit evidence. ChainSecurity reported 0 critical and 0 high findings for Chief; the 2026 xchain-helpers review reported 0 open critical/high findings, with lower-severity findings corrected. These are scoped code assessments, not proof of the currently deployed addresses. Contradiction / gap: claimed multi-chain coverage versus no independently verified deployments on Arbitrum, OP Mainnet, or Unichain: Not verifiable as of October 6, 2026.

Audit of Sky stUSDS (staked USDS) smart contracts, which are part of the Sky savings / yield path often used in conjunction with Sky Lending.

ChainSecurity — MakerDAO Liquidations 2.0

Audit of Sky smart contracts related to the core Sky/Maker architecture (lending and stablecoin system). Focus on security, functional correctness, and integration with the existing system.

Audit of Dss Flappers module referenced in Sky’s bug bounty registry, relevant to collateral management/liquidations; supports Sky Lending’s broader system security.

Audit of Sky "Chief" smart contracts, covering governance/executive control components that set parameters for the Sky Lending stack.

New published report identified since the last successful check on September 6, 2026: ChainSecurity — Sky LZ Init Lib.

New published report: ChainSecurity — Sky Wormhole NTT Migration Updates.

New published report: ChainSecurity — Chief Smart Contracts.

New published report: ChainSecurity — Sky Smart Contracts.

New published report: ChainSecurity — Lockstake Smart Contracts.

New published report: ChainSecurity — Endgame Toolkit Smart Contracts.

Corrected prior record: PeckShield — MCD Smart Contract Audit Report.

Corrected prior record: Trail of Bits — MCD Core Smart Contracts Final Report.

Gauntlet — Liquidations 2.0 Economic Simulation

Secondary sources state that Sky’s lending stack and aligned protocols (notably Spark, the Sky‑aligned lending protocol) are audited by multiple firms including ChainSecurity and OpenZeppelin, with formal verification by Certora on components like LitePSM and USDS/SKY converters. These relate to the broader Sky lending ecosystem rather than a single monolithic "Sky Lending" contract set.

I could not verify any protocol-security audit reports for Sky Lending from independent auditor sources in the provided search results. The results returned DeFiLlama analytics and unrelated Sky corporate audit material, but no confirmed Sky Lending smart-contract audit report with scope, findings, or fix status.

Security audit of Sky/Maker smart contracts around 2020, focusing on protocol security and integration during major upgrades.

Quantstamp — MakerDAO Liquidations 2.0 Final Report

Formal verification / audit of Sky (MakerDAO) smart contracts; cited as part of Sky’s formal verification track record.

Multiple audits of Sky (formerly MakerDAO) core smart contracts and liquidations system; part of Sky’s documented "robust smart contract audits" cited by S&P Global and independent risk oracles.

Trail of Bits — MakerDAO Liquidations 2.0 Final Report

Identity and continuity. Sky Savings Rate Onchain is the savings interface for Sky Protocol, the renamed and restructured continuation of MakerDAO—not a newly founded lending project. The rebrand was announced on August 27, 2024, with USDS and SKY replacing DAI and MKR as the ecosystem’s principal assets. Because on-chain verification was unavailable in this run, contract continuity, founder-controlled holdings, and chain-specific exposure are Not verifiable as of October 10, 2026. Founders and team. Rune Christensen is the publicly identified founder/co-founder and remains the central public architect of the Maker/Sky “Endgame” strategy.

Nikolai Mushegian is also widely identified as a MakerDAO co-founder and early protocol designer; he died in 2022. Publicly listed current operating roles include operations, legal, risk, capital markets, business development, and engineering/product personnel, but the available evidence is primarily a project-intelligence listing rather than independently audited employment or corporate records. Track record and incidents. MakerDAO/Sky has a long operating history dating to Maker’s early DAI development and has run one of DeFi’s largest stablecoin and collateral systems. A source claims no smart-contract exploit causing user fund loss over eight-plus years, but that claim is not sufficiently supported here by an auditor incident database or complete loss-event review; therefore, a definitive “no hacks” conclusion is Not verifiable as of October 10, 2026.

The available results do not establish Christensen’s other prior projects or independently verify their outcomes. Credibility and reality check. The founder is doxxed and the project has a substantial public operating history, governance footprint, and named functional team—materially stronger than an anonymous web-front protocol. However, the available sources do not verify a physical office, legal domicile, operating entity, or onshore/offshore status. Those items are Not verifiable as of October 10, 2026.

Sky.money’s non-custodial gateway description is a protocol-positioning claim, not proof of corporate substance or jurisdiction. Risk assessment: public leadership and Maker continuity support credibility, but entity, office, jurisdiction, independently verified personnel, and comprehensive incident history remain unresolved. Treat protocol-origin claims based only on Sky’s own materials as unverified marketing claims.

Reputation assessment: generally strong, but with material governance, capitalization, concentration, and regulatory concerns. Sky Lending is the lending component of Sky, formerly MakerDAO, and benefits from MakerDAO’s long operating history. Available evidence does not substantiate fraud, a rug pull, Ponzi activity, insolvency, or sanctions as of October 4, 2026. On-chain verification is unavailable in this run; therefore, TVL, exposure, chain allocation, holders, and treasury claims are Not verifiable as of October 4, 2026.

• Auditors/security: ChainSecurity’s June 2025 review described the audited codebase as providing a high level of security, while explicitly noting that audits are time-limited and cannot find every vulnerability. Independent reporting also identifies historical reviews involving Certora, Trail of Bits, and OpenZeppelin, but the precise scope for every current Sky Lending deployment is not established. CertiK lists Sky as not audited by CertiK, while recording third-party audits.
• Independent credit signal: S&P Global assigned Sky a B- issuer credit rating and, in October 2026, affirmed it while highlighting legal and regulatory uncertainty surrounding DeFi and DAO structures. The rating is a significant negative signal rather than evidence of default or insolvency.
• Main criticisms: Reported concerns include a roughly 0.4% risk-adjusted capital ratio, depositor concentration, reliance on crypto and tokenized-asset collateral, centralized governance, low voter participation, and founder concentration. These are structural risk findings, not allegations of misconduct.
• Governance/security-process concerns: An independent review alleges that critical upgrades may have only an 18-hour exit window and that Sky lacks an independent security council; it nevertheless characterizes the protocol as legitimate and not a rug pull or Ponzi scheme. These claims should be treated as independent analysis, not protocol-confirmed facts.
• Regulatory exposure: sUSDS-related products are reported as geo-fenced from U.S. users, and regulatory treatment of decentralized stablecoin and DAO structures remains uncertain.
• Founders/investors: Rune Christensen is identified as a central governance participant, with reporting attributing nearly 9% of governance-token ownership to him; this increases key-person and governance-concentration risk. No verified institutional-investor list or current investor-control assessment was established. Unresolved concerns: governance centralization and rapid upgrade procedures; thin capitalization relative to potential losses; collateral and custodian/real-world-asset concentration; regulatory classification; and the fact that audits do not eliminate oracle, liquidation, integration, or governance risks. Claims in the previously recorded comparison articles about approximately $5.6 billion TVL and “two audits” are not independently on-chain verified here and should not be treated as confirmed.

Economic model (reviewed October 6, 2026). Sky Lending is a collateralized-debt/CDP system: approved crypto/RWA collateral enters vaults; USDS/DAI is issued out; borrowers pay stability fees and liquidation income can accrue to the protocol. This is directional collateral/credit exposure, not market-neutral. Liquidation, oracle, collateral-price, governance, smart-contract, and stablecoin-peg risks apply. Yield and products. sUSDS yield is governance-set and funded from aggregate protocol surplus, principally Sky Agent Base Rates plus other lending/RWA/treasury revenues; it is not tied to one borrower, collateral pool, or strategy.

This is economically organic protocol revenue, but the distributable rate is governance-controlled and can exceed current realized revenue, so organic_yield_pct cannot be quantified from available evidence. stUSDS adds variable SKY-backed borrowing exposure and depends on utilization. Ecosystem Rewards are subsidized/partner-token or points incentives. Morpho Sky Vaults and Pendle fixed-yield products add external strategy/market and maturity risk. Leverage/withdrawals. Borrowers may leverage or loop collateral, but a protocol-wide leverage ratio is Not verifiable as of October 6, 2026. sUSDS has no stated lock-up, zero interface fee, and permissionless conversion back to USDS with instant liquidity; Pendle positions can trade below entry before maturity.

Vault withdrawals depend on underlying market liquidity and limits. Revenue/collateral. Revenue sources are stability fees, liquidation income, and PSM conversion fees; DeFiLlama reports approximately $26.9m fees and $13.5m revenue over 30 days in its latest snapshot. TVL and APY. DeFiLlama reports Sky Lending TVL of approximately $5.95bn, all attributed to Ethereum, with 8 tracked yield pools and roughly 3.8% average supply APY. The Sky interface separately shows sUSDS TVL around $4.65bn and current SSR APY of 3.60%; its displayed 6-month rate is 3.61%, suggesting low recent volatility, but historical sustainability is not assured. Contradiction / data gap. User-specified chains are Arbitrum, Ethereum, OP Mainnet, and Unichain, but current DeFiLlama Sky Lending attribution shows only Ethereum. Dune cross-check, exact TVL by requested chain/product, and Dune-vs-DeFiLlama trend are Not verifiable as of October 6, 2026.

Assessment as of October 6, 2026. Reported size and liabilities. Sky’s latest available Capital Management snapshot reports $89.47M of Sky Reserves (Sky Capital plus Operating Cash Balance), dated September 21, 2026. An independent S&P Global Ratings assessment reports approximately $92M as of September 17, 2026; the difference is likely methodology/timing, but is unresolved. Sky’s balance sheet reports $11.37B collateral/reserves, $11.42B obligations, and $254.46M Sky capital, as of block 25,936,977 (September 9, 2026, 02:58 UTC). Treasury composition and custody. Sky’s methodology identifies the treasury as token holdings of the Ethereum-mainnet Pause Proxy, consisting of SKY, MKR, GROVE, and SPK.

The current treasury line is reported at $160.7M on the September 9 balance sheet. The methodology identifies the treasury address as 0xbe8e3e3618f7474f8cb1d074a26affef007e98fb. This is smart-contract custody, not an identified third-party custodian.

Individual token balances and full contract-address mapping were Not verifiable as of October 6, 2026. Control and reserve policy. Governance controls the Pause Proxy through the Governance Security Module, which imposes an execution delay; authorized governance can schedule actions, while anyone may execute an eligible action after the delay. Sky’s stated policy targets a $150M reserve floor, with surplus directed toward reserve accumulation until that threshold is reached. S&P notes the target is nominal rather than risk-scaled. On-chain verification. Dune MCP was unavailable in this run; therefore Dune query IDs, execution IDs, latest block-level balances, and chain-by-chain reserve percentages are Not verifiable as of October 6, 2026.

The identified treasury is on Ethereum; reserve balances on Arbitrum, OP Mainnet, and Unichain are Not verifiable as of October 6, 2026. Attestations. Sky’s own balance-sheet methodology states the dashboard is a management statement, not an audited GAAP/IFRS statement. A formal reserve attestation or proof-of-reserves report was Not verifiable as of October 6, 2026. Contradiction / finding: the latest reported liquid-reserve figure ($89.47M–$92M) is materially below the $150M policy target, while the broader treasury mark is $160.7M; these are different categories and should not be treated as interchangeable.

Native token: SKY (Sky governance token), Ethereum contract 0x56072C95FAA701256059aa122697B133aDEd9279. Sky documentation identifies SKY as the sole token for on-chain voting, protocol-parameter changes, delegation and staking. Supply/valuation (aggregator, not Dune/on-chain verified): CoinGecko reports approximately 23.46B total supply, 23.422B circulating, $2.13B market cap and $2.13B FDV in its latest snapshot. These figures may use methodology different from Sky’s on-chain dashboard. Utility and rewards: SKY governs Sky Ecosystem decisions, including savings/borrowing parameters and upgrades.

Staked SKY can retain voting power, earn variable staking rewards and support USDS borrowing. Sky states rewards are treasury-funded, open-market SKY buybacks rather than newly issued tokens; it also states that new emissions are permanently disabled and maximum supply is capped at 23.46B. These are protocol-stated claims, not independently verified in this run.

No separate contractual revenue-share entitlement was identified. Minting, burns and controls: The token framework states that only governance-authorized contracts can mint; the principal historical source was MKR→SKY conversion at 1:24,000. Holders can burn their own SKY. The framework reports no blacklist, freeze, pause or arbitrary transfer-blocking function, and describes the token as non-upgradeable.

Governance controls the converter fee and can collect conversion fees. Emissions/unlocks/allocations/holders: Not verifiable as of October 4, 2026 for an on-chain-verified emissions schedule, unlock schedule, announced-versus-realized unlocks, team/investor/treasury/community allocations, top-holder concentration or insider-wallet attribution. Dune MCP was unavailable. Liquidity/listings: CoinGecko identifies Binance as the most active SKY venue; DEX liquidity depth and complete main-listing verification: Not verifiable as of October 4, 2026. Multi-chain circulating supply/exposure across Arbitrum, OP Mainnet and Unichain is likewise Not verifiable as of October 4, 2026.

A Bitcoin fall below $10,000 would be a stress event for Sky primarily through BTC-backed lending and collateral-linked positions, not because the Sky Savings Rate itself mechanically tracks Bitcoin. The direct size of Sky’s current BTC exposure, by chain and as a percentage of total exposure, is Not verifiable as of October 10, 2026 because on-chain verification was unavailable.

• Liquidation and bad-debt risk: In SparkLend, a collateral price decline reduces borrowers’ health factors; positions below 1 become liquidatable. Liquidations can occur automatically, at unfavorable prices, and may include penalties or fees.
• Reduced direct BTC transmission: Spark documentation states that BTC e-mode was removed and remaining positions were force-liquidated in June 2026. This should reduce—but does not prove elimination of—Sky’s direct BTC-collateral exposure.
• Wrapped-Bitcoin basis and oracle risk: Listed assets such as WBTC and cbBTC rely on peg-ratio monitoring; if deviations breach thresholds, a killswitch can halt new borrowing against distressed collateral. A Bitcoin crash could therefore combine market losses with wrapper, liquidity, and oracle-dislocation risks.
• Protocol-level impact: If liquidations fail to cover debt, losses can become bad debt and absorb Sky’s surplus or first-loss capital. Sky’s legal risk disclosure explicitly states that stUSDS carries first-loss exposure to collateral shortfalls.
• Savings-rate implications: The SSR is governance-set and variable rather than Bitcoin-linked. A severe BTC shock could nevertheless pressure protocol revenue, reserves, liquidity, and confidence in USDS/sUSDS; the available sources do not quantify the resulting rate change.
• Capital-buffer sensitivity: Moody’s-related reporting described approximately $90 million of tangible common equity against roughly $10 billion of managed assets and identified capitalization as a material weakness. This is an external reported assessment, not an on-chain verification. > Contradiction / verification gap: Protocol-facing materials describe continuously inspectable on-chain collateral and reserves, while the available independent evidence does not provide a current, chain-by-chain BTC exposure figure for the specified Sky Savings Rate deployment. Therefore, the exposure percentage and stressed loss are Not verifiable as of October 10, 2026. Overall, the principal institutional concern is liquidation execution and residual bad debt under a disorderly BTC sell-off, followed by possible pressure on reserves and USDS liquidity—not an automatic one-for-one reduction in the SSR.

Assessment: high severity, but portfolio loss is not quantifiable from the available evidence. A 20% fall in the largest collateral would likely push a material set of vaults toward liquidation, depending on each vault’s collateralization ratio, liquidation threshold, debt ceiling, and available auction liquidity. The exact largest collateral, exposure by chain, affected debt, and expected bad debt are Not verifiable as of 2026-10-04 because on-chain verification was unavailable in this run. Sky’s liquidation process transfers collateral and debt from an undercollateralized vault to the protocol, after which the collateral is auctioned to repay debt.

Sky documentation warns that insufficient liquidation capacity—such as restrictive global or per-collateral auction limits—can allow undercollateralized positions and bad debt to accumulate. A 20% shock is therefore not equivalent to a 20% protocol loss: losses depend on initial leverage, liquidation penalties, auction execution, oracle timing, market liquidity, and whether collateral prices gap further during forced sales. Independent ratings evidence indicates that Sky’s liquidation mechanisms have historically produced minimal loan losses, but identifies delayed liquidations during extreme volatility as a residual loss risk.

The same source identifies a separate transmission channel: if a collateral shock undermines confidence in USDS/DAI, conversion demand through the PSM could exceed available liquidity, creating a stablecoin liquidity-run risk. > Key limitation: The largest collateral and its percentage of total exposure across Ethereum, Arbitrum, OP Mainnet, and Unichain are Not verifiable as of 2026-10-04. No chain-level stress loss, liquidation volume, or bad-debt estimate should be inferred. Operationally, the scenario should be treated as a simultaneous liquidation, auction-liquidity, oracle, and USDS-peg stress, rather than only a collateral-markdown event.

Sky’s own user-risk disclosures also state that supplied-asset declines can trigger automated liquidation at unfavorable prices and with penalties.

Stress scenario — top counterparty insolvent (Sky Lending) Finding: The identity, exposure, and loss concentration of the top counterparty on Arbitrum, Ethereum, OP Mainnet, and Unichain are Not verifiable as of October 4, 2026. Dune/on-chain verification was unavailable, so no chain-level exposure percentages or counterparty ranking are asserted. Expected loss path 1. Counterparty defaults or collateral becomes insufficient.

2. Sky’s liquidation mechanism transfers the collateral and associated debt to the protocol; keepers execute a collateral auction. 3.

If auction proceeds do not cover debt plus penalties, the shortfall becomes protocol bad debt. The remaining loss is recorded in the system’s debt-accounting layer rather than charged directly to a separately identified insurance pool. 4.

The Vow-style debt manager first offsets debt against available system surplus through heal/kiss. Queued debt (sin) must mature before it can be processed. 5.

If surplus is insufficient, a debt auction (flop) can sell governance tokens to raise DAI/USDS and recapitalize the system. This creates dilution/selling pressure for governance-token holders. Who absorbs it / compensation

• Immediate absorber: system surplus, reducing funds otherwise available for surplus distribution or buyback/burn-type mechanisms.
• Secondary absorber: governance-token holders through debt-auction dilution and potential price impact.
• Residual absorber: economically, remaining lenders/USDS holders and the broader Sky system if bad debt cannot be fully auctioned or reconciled.
• Direct compensation: Not verifiable as of October 4, 2026. No verified, automatic depositor-insurance or counterparty-loss reimbursement mechanism was identified. Smart-contract impact path: liquidation/auction contracts → protocol accounting (Vat/debt records) → Vow debt queue and surplus reconciliation → debt auction (flop) if required. A separate external/RWA counterparty insolvency may not trigger ordinary liquidation automatically; its recovery path is Not verifiable as of October 4, 2026 without the specific collateral adapter and legal structure.

Assessment (as of October 4, 2026): No verified evidence found that Sky’s DAO, owners, or co-founder committed fraud. The relevant evidence supports a high governance-concentration and takeover risk, not completed fraud. S&P Global’s October 1, 2026 assessment states that co-founder Rune Christensen controls approximately 9% of governance tokens, but low voter turnout gives him effective influence over key decisions. It also identifies concentration in the facilitator role and notes that an actor controlling sufficient voting power could potentially dominate governance.

S&P’s earlier account describes a February 2025 attempt by coordinated voters to take control of Sky and derail its strategy. The attempt was outvoted; this is evidence of a governance conflict or attempted governance capture, not proof that the DAO or owners committed fraud. The previously identified reporting characterizes the episode as an allegation of a governance attack, with denial by the accused side.

No independently verified source located in this review establishes theft, deceptive misappropriation, falsified reporting, or other committed fraud by Sky’s DAO or owners. The Immunefi material confirms that Sky maintains a formal bug-bounty framework, but its existence does not establish that fraud did or did not occur. Stress conclusion:

• Committed DAO/owner fraud: not substantiated.
• Governance capture or unilateral decision-making risk: material, due to effective founder influence and low participation.
• Fraud-loss scenario severity: unquantifiable from the available evidence; on-chain verification was unavailable in this run. Contradiction / limitation: Any claim that Sky is fully decentralized conflicts with S&P’s finding of effective founder control. This is a structural-risk finding, not proof of fraud. On-chain verification: Not verifiable as of October 4, 2026.

Assessment: Not verifiable as of 2026-10-04. No independent source found in this check establishes that Sky Lending’s primary yield source was negative over the preceding 30 days. On-chain verification was unavailable, so no contract-level yield, revenue, reserve, or chain-allocation conclusion can be made. Available evidence describes Sky’s yield as multi-source rather than dependent on one source: the Sky Savings Rate is reportedly funded by protocol surplus, including collateralized-loan revenue, Treasury-bill/RWA exposure, lending markets, and Sky Agent Network activity.

For stUSDS specifically, yield is described as depending on SKY-backed borrowing utilization, with idle capital receiving the Sky Savings Rate. These are descriptions of the mechanism, not proof that any source was negative during the 30-day window. A third-party source reported a 3.60% Sky Savings Rate on 2026-09-16, while another reported a 5.38% stUSDS rate on 2026-09-02; neither demonstrates a negative primary source or provides a complete 30-day attribution series.

DeFiLlama search results show 30-day fees of $30.71 million and average APY of 0.6%, but these are analytics-platform figures and do not establish that the primary yield source turned negative. Stress conclusion: the requested negative-30-day-primary-source scenario is not evidenced. The relevant risk is still material: a fall in Treasury/RWA income, lending demand, or Agent Network returns could pressure the governance-set savings rate and surplus buffer. However, the magnitude, duration, and chain-specific exposure across Arbitrum, Ethereum, OP Mainnet, and Unichain are Not verifiable as of 2026-10-04. Contradiction / evidence gap: protocol-related descriptions characterize revenue as diversified, while available analytics report positive aggregate fees; neither provides an independently verified 30-day primary-source attribution.

The gap—not a negative yield finding—is the result.

Assessment as of October 13, 2026: Sky Savings Rate Onchain is governed by the broader Sky Protocol, not a separate lending DAO. SKY holders vote through governance polls and executive votes; passed proposals deploy one-time immutable “Spells” through the Chief, with the Pause/GSM enforcing the governance security delay. The process is operational: the governance portal records an executive passed October 9 and executed October 12, 2026.

Governance controls protocol parameters, upgrades, and protocol-owned surplus/treasury balances. The DAO is therefore real rather than symbolic, but voting power is concentrated: a recent SEC filing reports the six Ranked Delegates held approximately 97.4% of delegated voting power and the two largest approximately 64.4% as of October 2, 2026. Dune was unavailable for this run, so wallet-level top-holder rankings and per-chain concentration are Not verifiable as of October 13, 2026.

The GSM/Pause provides a timelock; the previously verified setting was 48 hours. Some predefined instant-access modules can bypass ordinary voting/security-delay procedures within limited scopes, creating an emergency-bypass risk. The protocol docs do not establish a general unrestricted drain key.

The admin_can_drain: true assessment is retained for protocol-controlled funds and privileged emergency/treasury pathways; it does not mean Skybase can withdraw user assets. Frontend/company control: Skybase International operates the app interface and owns its IP, while stating it does not control the protocol or custody user assets. Its Terms use Cayman Islands law and Cayman arbitration.

Exact registration number and directors are Not verifiable as of October 13, 2026.

As of October 4, 2026, Sky Protocol is described as decentralized, non-custodial smart-contract infrastructure rather than a conventional legal entity. The identifiable interface operator is Skybase International, an exempted company incorporated in the Cayman Islands; its ToS use Cayman law and Cayman courts/arbitration. ToS/restrictions: Skybase disclaims being a broker, dealer, exchange, adviser, custodian, or financial-services provider. Users bear legal, tax, sanctions, AML/ATF, and regulatory-compliance responsibility.

The current ToS prohibit users from sanctioned/prohibited jurisdictions, prohibit VPN circumvention, and reserve geo-blocking or termination rights. The prior recorded KYD 100 liability cap is outdated: the current ToS state a cap of the greater of fees paid in 12 months or USD 10,000. KYC/AML and sanctions: No formal customer-identification/KYC program, money-transmitter licence, or protocol-level AML framework was verifiable as of October 4, 2026. The interface privacy policy states that Skybase may use geo-blocking, VPN detection, and sanctions screening; this is interface compliance, not proof that permissionless contracts screen every address.

No evidence was found that Sky Protocol or Skybase International itself is sanctioned. Classification/regulatory risk: Sky is economically a collateralized stablecoin/lending protocol with governance and savings modules. S&P characterizes it as having no headquarters-specific jurisdiction and highlights material regulatory uncertainty and U.S. economic/legal ties. Whether USDS, SKY, savings products, or protocol activity constitute securities, commodities, payment instruments, lending, or regulated crypto-asset services remains jurisdiction-dependent and was not conclusively verifiable. Enforcement/courts: No active regulator enforcement action against Sky Protocol or Skybase International was located in the reviewed SEC, CFTC, FinCEN, OFAC, and court sources as of October 4, 2026.

A True Return Systems patent case against MakerDAO was voluntarily dismissed with prejudice on August 13, 2024; this was not a regulatory enforcement action. Data protection/legal-risk view: Skybase is the stated data controller for the interface and may collect wallet-linked consent records, IP/device, usage, communications, and behavioral data, while excluding third-party protocols/wallets from its policy. The main legal-risk mismatch is that a Cayman interface company offers contractual protections only for interface services, whereas users’ substantive exposure remains to permissionless contracts, governance, third-party integrations, and potentially applicable laws worldwide.

No exact GLEIF LEI record for 'Sky Savings Rate Onchain'. OFAC SDN screening of 'Sky Savings Rate Onchain': no match. SEC litigation and administrative release feeds: no mention.

Sky Lending issues its own native stablecoin, USDS, and the protocol is generally stable. The most supportable depeg episode in the gathered sources is the March 2023 USDC crisis, when DAI/USDS-related pricing moved below $1; however, the exact number of depeg events and the maximum depeg magnitude are not verifiable as of 2026-10-06 from the available sources. last_depeg_date is 2023-03-11.

Sky Lending’s highest-priority risks remain smart-contract/oracle failure, liquidation-driven bad debt, reserve and stablecoin counterparty exposure, governance concentration, and regulatory/cross-chain fragmentation. Current documentation confirms audits, bug bounty coverage, governance and oracle delays, auction limits, and geo-blocking; these reduce but do not eliminate tail risk. Dune was unavailable, so chain-level exposure and on-chain TVL are Not verifiable as of October 5, 2026; independently, DeFiLlama attributes 100% of tracked TVL to Ethereum, contradicting the supplied four-chain scope.

Sky Lending’s top 5 strengths are: battle-tested longevity, a large stablecoin/liquidity base, multichain access, yield simplicity, and institutional credibility. Sky is repeatedly described as the successor to MakerDAO, which supports the longevity point and suggests a long operating history through multiple market cycles. Its savings product centers on USDS/sUSDS and the Sky Savings Rate, which is presented as a simple, liquid yield mechanism with instant liquidity and no fee, reducing user friction compared with more complex lending setups.

The protocol is also presented as multichain via SkyLink / supported chains, improving distribution and accessibility across Ethereum, Arbitrum, OP Mainnet, and Unichain. Finally, Sky’s institutional credibility is reinforced by broad third-party coverage and its positioning as an evolved, scalable DeFi infrastructure layer rather than a niche farm. If you want the strongest concise framing: Sky’s edge is that it combines a long-lived Maker-derived balance sheet, a simple liquid savings product, and cross-chain distribution.

The one caveat is that on-chain verification is not available in this run, so chain-level TVL/exposure splits remain not verifiable as of 2026-10-04.