Don’t invest unless you’re prepared to lose all the money you invest. This is a high‑risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more.
MKR → SKY, DAI → USDS: The Next Generation of Tokens
What is going on with Maker (MKR) and Dai (DAI)? And what is Sky (SKY) and what is USDS? Here is everything you need to know.
In this article...
- Maker (MKR) will be upgraded to Sky Governance Token (SKY)
- The goal is to make DeFi easier to understand and use for regular people
- It is seen as a bold move towards mainstream DeFi adoption.
MakerDAO, the organisation behind Maker (MKR) and Dai (DAI), has rebranded to Sky Protocol. MKR, the governance token, has been upgraded to Sky Governance Token (SKY), and DAI, the stablecoin, has been upgraded to USDS. This rebrand aims to make decentralised finance (DeFi) more accessible and user-friendly for mainstream adoption.
MKR will remain a separate token to SKY, but it can be swapped for SKY on the SKY protocol or on CoinJar (normal fees apply).
USDS and DAI will be two separate tokens, with both Dai and USDS being used in the Sky Protocol.
DAI and USDS remain interchangeable.
According to the Sky Protocol documents, “USDS is linked to the same issuance source as DAI, ensuring that USDS maintains parity with DAI. The converter contract allows holders of DAI or USDS to convert between these ERC20 tokens at any time, with no liquidity restrictions.”
DAI remains the legacy stablecoin, and USDS is the newly upgraded version under Sky Protocol.
The optional upgrade lets users take advantage of new features on the Sky Protocol (like earning rewards via Sky Savings Rate or Sky Token Rewards). You must leave the CoinJar platform and move your activities to the Sky Protocol to participate in Sky Savings / Sky Rewards.
There is no indication that DAI will be phased out entirely (yet!) and HOLDERS can continue to use it or opt for USDS.
MKR to SKY: Why is this happening?
The goal is to simplify DeFi and attract a broader audience. MakerDAO, an early leader in DeFi, is transforming its core products to enhance usability and scalability while maintaining its decentralised roots. The rebrand is part of a strategic overhaul to streamline governance and foster innovation.
The changes
New stablecoin
The USDS stablecoin, designed to maintain a US$1 value, is the upgraded version of DAI. USDS has surpassed DAI by market cap (as of 03 September 2025). DAI still however remains active as a stablecoin in the top ten list of stablecoins. Users can swap USDS back to DAI at a 1:1 ratio.
New governance token
SKY, the upgraded version of MKR, is the governance token for Sky Protocol. SKY holders can vote on protocol decisions, stake tokens to earn rewards, and borrow USDS via the Staking Engine (Note that CoinJar does not offer staking, customers must leave the CoinJar platform to stake on the Sky Protocol). Each MKR token can be swapped for 24,000 SKY tokens on the Sky Protocol. Or CoinJar customers can swap MKR for SKY on CoinJar (normal fees apply).
Note that a penalty fee for late MKR to SKY conversions on the Sky Protocol may apply starting September 18, 2025.
MakerDAO’s SubDAOs are now called Sky Stars, independent projects within the Sky ecosystem.
The rebrand to Sky signals a push for mainstream DeFi adoption. If you choose not to upgrade, DAI and MKR remain functional within the Sky system but lack access to these new features. Many crypto exchanges, such as CoinJar, are supporting MKR to SKY swaps.
CoinJar-Specific Information
CoinJar is aligning with MakerDAO’s transition to Sky Protocol by delisting MKR and listing SKY on its platforms. Below are key details and actions for CoinJar customers.
SKY is available for trading on CoinJar and CoinJar Exchange.
MKR trading, Bundles, and Recurring Buys have ceased on CoinJar and CJX. MKR deposits are disabled, and all open MKR trading orders on CoinJar Exchange have been cancelled, with remaining MKR returned to CoinJar accounts.
To convert to SKY at the protocol rate: Withdraw MKR to an external wallet that supports the 1:24,000 MKR→SKY migration.
Selling, swapping, rebalancing, or disposing of MKR may have tax implications, including Capital Gains Tax. This is not tax advice; please consult an accountant or financial advisor.
Maker to Sky
Sky Protocol’s transformation reflects a commitment to simplifying DeFi and enhancing user experience. The introduction of USDS and SKY aims for long-term growth in the DeFi landscape.
Frequently asked questions
What is the Sky Protocol and why is MakerDAO transitioning?
The Sky Protocol represents the evolution of MakerDAO, introducing new tokenomics, enhanced features, and expanded ecosystem capabilities. This transition aims to improve user experience, introduce new reward mechanisms, and position the protocol for future growth in the decentralised finance space.
What are the conversion rates for the token migration?
MKR to SKY: 1 MKR token converts to 24,000 SKY tokens DAI to USDS: 1 DAI converts to 1 USDS (1:1 ratio)
Is the conversion process automatic?
No, the conversion is entirely voluntary and user-initiated. You can do a swap on the CoinJar platform for MKR to SKy (normal fees apply). Or you can manually convert your tokens through the official Sky Protocol interface at sky.money. Your original MKR and DAI tokens will remain in your wallet until you choose to convert them.
Can I still use my MKR and DAI tokens without converting?
Yes, both MKR and DAI continue to function normally. You can still: Use DAI for transactions and DeFi activities, participate in governance with MKR tokens, and hold either token. However MKR will soon be delisted from CoinJar and other exchanges.
What happens if I don't convert by a certain deadline?
SKY will be the exclusive governance token for the Sky protocol. While your MKR tokens won't disappear, their governance functionality may be limited after this final migration phase.
Where can I safely convert my tokens?
Only use the CoinJar platform or the official Sky Protocol website (sky.money).
Be extremely cautious of phishing sites or third-party conversion tools. Always verify you're on the correct official website before connecting your wallet.
Will converting affect the value of my holdings?
The conversion maintains the equivalent value of your holdings based on the established conversion rates. However, market dynamics may cause price variations between old and new tokens over time.
What happens to MakerDAO governance after the transition?
Governance will transition to use SKY tokens as the primary voting mechanism, especially after the September 2025 final migration phase. The governance process itself remains fundamentally the same, with token holders voting on protocol proposals and changes.
Suggested Articles
What is Bitcoin (BTC)? What is "Digital Gold" Used For?
What is Bitcoin? It is a digital currency that can be traded, exchanged, and used as a form of payment independent of central banks and governments.Read more
What is Ethereum? What is ETH Used For?
Ethereum is a decentralised blockchain-based open-source software platform that allows for the development of decentralised applications (dApps).Read more
What Is Crypto? How do Cryptocurrencies Work?
Crypto has become incredibly popular. But how does this digital currency work? And are there cryptos other than Bitcoin? Read moreBrowse by topic
Standard Risk Warning: The above article is not to be read as investment, legal or tax advice and it takes no account of particular personal or market circumstances; all readers should seek independent investment advice before investing in cryptocurrencies.
The article is provided for general information and educational purposes only, no responsibility or liability is accepted for any errors of fact or omission expressed therein. Past performance is not a reliable indicator of future results. We use third party banking, safekeeping and payment providers, and the failure of any of these providers could also lead to a loss of your assets.
We recommend you obtain financial advice before making a decision to use your credit card to purchase cryptoassets or to invest in cryptoassets.
Capital Gains Tax may be payable on profits.
CoinJar's digital currency exchange services are operated in the UK by CoinJar UK Limited (company number 8905988), registered by the Financial Conduct Authority as a Cryptoasset Exchange Provider and Custodian Wallet Provider in the United Kingdom under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, as amended (Firm Reference No. 928767).
In the UK, it's legal to buy, hold, and trade crypto, however cryptocurrency is not regulated in the UK. It's vital to understand that once your money is in the crypto ecosystem, there are no rules to protect it, unlike with regular investments.
You should not expect to be protected if something goes wrong. So, if you make any crypto-related investments, you're unlikely to have recourse to the Financial Services Compensation Scheme (FSCS) or the Financial Ombudsman Service (FOS) if something goes wrong.
The performance of most cryptocurrency can be highly volatile, with their value dropping as quickly as it can rise. Past performance is not an indication of future results.
Remember: Don't invest unless you're prepared to lose all the money you invest. This is a high-risk investment and you should not expect to be protected if something goes wrong. Take 2 mins to learn more.
UK residents are required to complete an assessment to show they understand the risks associated with what crypto/investment they are about to buy, in accordance with local legislation. Additionally, they must wait for a 24-hour "cooling off" period, before their account is active, due to local regulations. If you use a credit card to buy cryptocurrency, you would be putting borrowed money at a risk of loss.
We recommend you obtain financial advice before making a decision to use your credit card to purchase cryptoassets or to invest in cryptoassets.
Specific risks associated with stablecoins: There is a risk that any particular stablecoin may not hold their value as against any fiat currency; or may not hold their value as against any other asset. Stablecoins carry the following risks:
Depegging events: Depegging events may occur with stablecoins that fail to maintain adequate controls and risk mitigants. A depegging event is when the value of the stablecoin no longer matches the value of the underlying asset. This could result in a loss of some or all of your investment.
• Counterparty risk: Counterparty risk arises when an asset is backed by collateral, involving a third party maintaining the collateral, which introduces risk if the party becomes insolvent or fails to maintain it.
• Redemption risk: Redemption risk refers to the possibility that an asset's ability to be redeemed for underlying collateral may not be as anticipated during market fluctuations or operational issues.
• Collateral risk: Collateral risk refers to the possibility of the collateral's value declining or becoming volatile, potentially impacting the asset's stability, particularly when it is another crypto-asset.
• Exchange rate fluctuations: Stablecoins, often denominated in US Dollars, expose investors to fluctuations in the USD:GBP exchange rate.
• Algorithmic risk: Algorithm risk refers to the possibility of an asset's stability being compromised due to unexpected failure or behaviour of the underlying algorithm, potentially leading to loss of value.
Your information is handled in accordance with CoinJar’s Privacy Policy.
Cryptoassets traded on CoinJar UK Limited are largely unregulated in the UK, and you are unable to access the Financial Service Compensation Scheme or the Financial Ombudsman Service.
We use third party banking, safekeeping and payment providers, and the failure of any of these providers could also lead to a loss of your assets.
We recommend you obtain financial advice before making a decision to use your credit card to purchase cryptoassets or to invest in cryptoassets. Capital Gains Tax may be payable on profits.
CoinJar’s digital currency exchange services are operated in the UK by CoinJar UK Limited (company number 8905988), registered by the Financial Conduct Authority as a Cryptoasset Exchange Provider and Custodian Wallet Provider in the United Kingdom under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, as amended (Firm Reference No. 928767).
Apple Pay and Apple Watch are trademarks of Apple Inc. Google Pay is a trademark of Google LLC.
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.
