SKY
SKY demonstrates strong ownership characteristics with binding onchain governance and active value accrual through buybacks. The token is non-upgradeable with no censorship capabilities. Trademarks remain with an independent foundation.
SKY holders exercise binding governance through an approval-based voting workflow with a 24-hour timelock before any changes take effect. The token is non-upgradeable with no censorship capabilities. All privileged roles trace back to governance.
SKY holders vote to elect "spells" (upgrade contracts). The winning spell must wait 24 hours before it can execute changes. This creates binding, verifiable onchain governance.
Governance Workflow
How votes become protocol changes:
- Lock SKY tokens in voting contract
- Vote for a "spell" (upgrade contract)
- Winning spell schedules execution via plot()
- 24-hour delay enforced (eta >= now + 86400s)
- After delay, anyone can trigger exec()
The plot() function enforces the delay — no spell can execute without waiting.
Timelock Contract
All governance actions execute through a timelock (Pause Proxy). The 24-hour delay gives users time to exit before changes take effect.
All privileged roles trace back to SKY governance. A single "Pause Proxy" contract holds admin rights on all core contracts. Only governance-approved spells can act through it.
Core Contracts Controlled by Governance
The Pause Proxy holds admin rights on all key contracts. Verify by calling wards(0xBE8E3e3618f7474F8cB1d074A26afFef007E98FB) on each contract — returns 1 if authorized.
Emergency Controls
"Mom" contracts can adjust parameters without the 24hr delay for emergencies. These are governance-controlled via the authority pattern.
Core accounting contracts are immutable — their code cannot change. Newer stablecoin contracts (USDS, sUSDS) can be upgraded, but only through governance.
Immutable Core
Core accounting contracts have no upgrade mechanism. The deployed code is permanent.
Upgradeable Stablecoins
USDS and sUSDS use proxy contracts. Upgrades require governance approval through the standard voting process.
The SKY token cannot be upgraded. Its code is permanent with no admin backdoors.
Non-Upgradeable Token
Standard ERC-20 contract with no proxy pattern. The deployed code cannot be changed.
Only governance can mint new SKY. The primary source is conversion from legacy MKR tokens at a fixed 24,000:1 ratio. Anyone can burn their own tokens.
Minting Restricted to Governance
The mint() function requires authorization. Only governance-controlled contracts can call it.
MKR Conversion
Legacy MKR tokens convert to SKY at a fixed 24,000:1 ratio. The rate is immutable in the contract.
No admin can arbitrarily pause the protocol or restrict user access. Emergency shutdown exists but requires burning a significant amount of tokens.
Emergency Shutdown
The only way to "pause" the protocol is Emergency Shutdown, which requires burning tokens past a threshold. This is a nuclear option, not an admin switch.
No Arbitrary Pause
Core contracts have no pause function. Users can always interact with the protocol.
SKY has no blacklist, freeze, or admin-controlled transfer blocking. Tokens cannot be seized or frozen by anyone.
No Censorship Functions
The contract has no blacklist, freeze, or pause functions. Transfer functions are standard ERC-20 with no admin intervention points.
Protocol revenue flows to SKY holders through automated buybacks. When the protocol earns fees, it uses them to buy SKY on the open market. All fee parameters are governance-controlled.
A portion of protocol revenue (interest on loans, liquidation penalties) automatically flows to buybacks. The "Smart Burn Engine" purchases SKY using accumulated fees.
Smart Burn Engine
Automated buyback system. When protocol surplus exceeds the buffer threshold, the Splitter routes fees to the Flapper, which purchases SKY on UniswapV2.
Revenue Flow
Protocol revenue flows: Stability Fees → Vow (surplus) → Splitter → Flapper → SKY buybacks.
Revenue sources:
- Interest on loans (stability fees)
- Liquidation penalties
- Stablecoin swap fees (PSM)
All treasury assets are held onchain and controlled by governance. There is no offchain treasury or multi-sig.
Onchain Treasury
Protocol surplus is held in the Vow contract. Only governance can access these funds.
Governance controls all fee rates and revenue parameters. SKY holders decide how much the protocol charges and how revenue is distributed.
Fee Rate Control
Governance sets stability fee rates via the Jug contract. Each collateral type has its own rate, updated through governance spells.
Surplus Buffer Control
The surplus buffer ("hump") determines when buybacks trigger. Governance can adjust this threshold to control the pace of buybacks.
No verified offchain revenue streams flow to SKY holders. The DAI Foundation is an independent non-profit that does not distribute profits.
Foundation Independence
The DAI Foundation operates independently under Danish law. It holds trademarks but does not distribute value to tokenholders.
All code is open source (AGPL-3.0) and verified on Etherscan. Anyone can audit the contracts.
SKY token source code is open source and verified on Etherscan. Anyone can audit the code.
Verified Source
Source code matches deployed bytecode. Licensed under AGPL-3.0.
Every protocol contract is open source. A "chainlog" provides a registry of all deployed contract addresses.
Open Source Repositories
All protocol code is open source under AGPL-3.0. Core contracts, governance, and stablecoins all have public repositories.
Aragon has not been able to verify the concentration of holdings.
Aragon has not been able to verify the concentration of holdings.
Vesting contracts exist but specific unlock schedules were not enumerated in this analysis.
Vesting Contracts
Vesting contracts exist for token distributions. Governance controls these schedules.
Current Sky branding is not controlled by SKY tokenholders. Skybase International's terms reserve trademarks, service marks, logos, and trade names associated with the Services, including the Sky name, to the service operator or its licensors, and the DAI Foundation independently holds the legacy Maker and DAI trademarks. All code is open source (AGPL-3.0).
Official Skybase International terms state that trademarks, service marks, logos, and trade names associated with the Services are proprietary to Skybase International or its licensors, and explicitly include the Sky name. Aragon has not found evidence that current Sky / USDS branding is owned by a tokenholder-controlled legal entity. Separately, the DAI Foundation holds the legacy Maker and DAI trademarks outside token governance.
Skybase International Terms of Use
Skybase International's terms say trademarks, service marks, logos, and trade names associated with the Services are proprietary to Skybase International or its licensors, and explicitly include the Sky name.
DAI Foundation
Holds the legacy Maker and DAI trademarks. Operates under Danish law, independent of token governance.
Domain ownership not verified. Open source frontends exist that anyone can deploy.
Open Source Frontends
Multiple open source frontends exist. Anyone can deploy their own interface.
All code is AGPL-3.0 licensed. Anyone can fork and deploy the protocol. The license requires source disclosure.
AGPL-3.0 License
Copyleft license. Anyone can fork and deploy, but must share source code of modifications.
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