Sky founder and CEO Rune Christensen says the next phase of stablecoin adoption is being pushed by rising institutional demand for transparent, yield-bearing digital dollars.
He told Sandmark that USDS, Sky’s decentralised yield-generating stablecoin, is now entering a scaling phase after years of architectural overhaul and migration work.
Sky, formerly MakerDAO, powers USDS, which the company describes as the largest decentralised yield-bearing stablecoin. It currently offers a 4.5% savings rate and is used by a mix of funds, crypto-native institutions and fintech platforms. Christensen says the protocol has reached a turning point after a multi-year upgrade to its decentralised risk framework.
Institutional Demand Rising
Christensen says demand from institutions has intensified. “One thing I’m very happy about is that stablecoins have become almost an obsession for institutions,” he says. “They increasingly understand that stablecoins are going to change how the financial system works. The benefits are undeniable, and they want to be involved, even if they’re still quite confused and don’t fully grasp the mechanics.”
He argues that this shift has helped sustain interest in USDS. As a decentralized yield-bearing stablecoin, Christensen says Sky has become an attractive destination for allocators seeking low-risk, onchain return. “When money flows into stablecoins more broadly, some of it naturally flows into Sky,” he says.
The challenge, he adds, is not only capturing inflows but building the capacity to handle them. “The main goal for Sky over 2026 and beyond is to absorb more and more capital without creating systemic risk or having processes fall apart.”
(Sky founder and CEO Rune Christensen. Courtesy of Sky.)
He says the earlier MakerDAO system scaled quickly but outgrew its original design. “We had to reinvent processes and infrastructure from scratch for a decentralized paradigm,” he says. With the migration complete, Christensen says Sky is now focused on growing USDS supply, deepening integrations, and enabling fintech firms, wallets and businesses to offer the savings rate directly to users.
Decentralisation, regulation and the next phase of design
Christensen says existing regulatory frameworks remain anchored to centralised financial structures. “Right now, regulation tends to focus on centralised systems with single points of failure that regulators can identify and regulate,” he says.
He argues that Sky’s decentralised architecture does not map neatly onto traditional models. “It doesn’t have those single points of failure, so it doesn’t fit the same model as centralised stablecoins,” he says. Without a central authority approving, Christensen says users rely more heavily on transparency and verification tools.
To address this, Sky has invested in data-exposure and risk-reporting interfaces intended to resemble traditional financial dashboards. “Sky is getting better at exposing data, risk, and verification pathways in ways that TradFi, institutions, and anyone else can actually consume,” he says.
Christensen also points to regulatory progress around the centralised ends of the crypto market, such as exchanges, custodians and non-decentralised stablecoin issuers. He says this has helped reduce the reputational drag decentralised systems faced in earlier years. “It’s been frustrating to be linked reputationally with scams or badly run centralised entities that aren’t comparable to Sky,” he says. “We built Sky to stay safe without needing to trust a single party. Now the broader ecosystem is gradually catching up.”
New risk tokenisation model
Sky recently introduced stUSDS, a token Christensen describes as a more advanced, risk-aware instrument designed for sophisticated users. “This is absolutely for expert users, institutions, and smart money who know what they’re doing,” he says. “They’re taking on more risk, but they’re also getting a higher return.”
stUSDS provides funding for Sky stakers, who can borrow against their staked Sky positions. The higher yield paid to stUSDS holders compensates for that risk. Christensen says this is the first in a broader family of risk-tiered tokens tied to Sky’s Basel III-inspired credit-enhancement framework, which aims to structure collateral risk across tiers and improve capital efficiency while maintaining protection for USDS holders.
He argues that blockchain-based risk tranching can offer greater transparency than traditional finance. “In TradFi, it’s very opaque, you don’t really know the risk, you just trust the regulators,” he says. “And if you’re a smaller fund or institution, you may not even get access to the best opportunities.”
By contrast, Christensen says the on-chain version makes risks explicit and accessible. “The risks are clearly defined and increasingly presented in a way even less crypto-native users can understand,” he says. “I think that’s going to be very exciting and will help show bankers and TradFi that this is the future.”
Christensen expects risk-tokenisation models to become a major point of convergence for institutions entering onchain markets. “Stablecoins are inevitable, and this kind of structured, transparent, on-chain risk management simply would not be possible without them,” he says.
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