What Is USDS? Sky's Stablecoin and sUSDS Explained

Last updated: 26 October 2026.

This page covers Sky's USDS, the decentralized dollar stablecoin of the Sky protocol (formerly MakerDAO); Sperax USD and SpiceUSD also use the USDS ticker but are unrelated. Sky's USDS launched in September 2024 as the upgraded successor to DAI, converts 1:1 with DAI, and is backed by overcollateralized on-chain positions rather than a regulated issuer (Sky, checked 26 Oct 2026). Depositing it into sUSDS earns the variable Sky Savings Rate.

Key Takeaways

• USDS is the stablecoin of Sky, the protocol formerly called MakerDAO, launched on Ethereum on 18 September 2024 as the upgraded version of DAI (CoinDesk, 27 Aug 2024).
• USDS supply was $6.81B on 26 Oct 2026, the third-largest dollar stablecoin after USDT and USDC, with DAI fourth at $4.74B (DefiLlama).
• USDS and DAI convert 1:1 both ways, and sky.money showed 10.00B combined USDS and DAI supply against $15.89B of collateral on 26 Oct 2026 (Sky).
• Depositing USDS into sUSDS earns the Sky Savings Rate, 3.80% APY on $4.85B in the Ethereum pool on 26 Oct 2026 (DefiLlama).
• USDS has no licensed issuing company, so it does not fit the GENIUS Act's permitted payment stablecoin model; its main risks are collateral, smart contracts and governance.

USDS at a Glance

Each supply figure is quoted with its own source. DefiLlama and sky.money count differently, so the two should not be added together.

From MakerDAO and DAI to Sky and USDS

MakerDAO rebranded as Sky on 27 August 2024 and said USDS and the SKY token would go live on 18 September 2024, with DAI and MKR staying in circulation (CoinDesk). The governance poll for the launch set up the USDS token, sUSDS, and a DAI to USDS converter at a 1:1 rate both ways (Maker governance poll 1134, 9 Sep 2024).

How USDS Holds Its Peg

Overcollateralized positions: users and protocol modules lock more value in collateral than the USDS they generate, so the system holds a buffer. On 26 Oct 2026, sky.money showed $15.89B of collateral against 10.00B of combined USDS and DAI (Sky).

Liquidations: when a position's collateral falls too far, it is liquidated to cover the debt, which protects the backing of outstanding USDS.

The USDC swap module: the Peg Stability Module lets users convert USDC and USDS 1:1 with no fees and no slippage, according to sky.money, which anchors USDS near $1 (Sky, 26 Oct 2026). Full collateral categories are in what backs DAI and USDS.

USDS vs DAI: What Changed and Which to Hold

Sources: sky.money, DefiLlama USDS, DefiLlama DAI, Maker governance poll 1134. Holders who want the Sky Savings Rate or Sky rewards need USDS; DAI remains widely integrated in older DeFi apps.

How to Get USDS

Swap USDC to USDS on sky.money

The Sky app offers 1:1 USDC to USDS conversion both ways, with no fees and no slippage (Sky, 26 Oct 2026). You pay only network gas.

Upgrade DAI to USDS

DAI holders can upgrade 1:1 in the Sky app through the DAI to USDS converter, and can convert back the same way.

Buy on an exchange

USDS also trades on centralized and decentralized exchanges. Check that the token contract is Sky's USDS, not another coin with the same ticker.

sUSDS and the Sky Savings Rate

sUSDS is the savings version of USDS. Sky describes the Sky Savings Rate as a variable protocol rate funded from aggregate protocol surplus that can change over time (Sky). On 26 Oct 2026 the Ethereum sUSDS pool paid 3.80% APY, averaged 3.73% over 30 days and held $4.85B (DefiLlama). Spark Savings USDC paid the same 3.80% that day (DefiLlama). Compare options on our stablecoin yields page.

Where USDS Lives

Almost all USDS is on Ethereum: $6.80B of $6.81B on 26 Oct 2026, with a few million on Solana and Base (DefiLlama). Sky's bridge system for other chains is covered in our SkyLink guide.

Is USDS Safe? Risks to Know

• Collateral drawdowns: sharp market falls can stress liquidations.
• Reliance on USDC through the swap module, which ties USDS to Circle's coin.
• Oracle and smart contract risk across Sky's contracts.
• Governance changes: SKY holders can change rates and parameters.
• No deposit insurance. See are stablecoins safe?.

USDS and Regulation

The GENIUS Act licenses permitted payment stablecoin issuers, and USDS has no licensed issuing company, so it is not a GENIUS payment stablecoin. How the Act's 18 July 2028 rule for US platforms will apply to decentralized tokens like USDS is unclear. Our GENIUS Act explainer tracks the rules, and USDe is another non-bank dollar facing the same question.

FAQs

What is USDS?

Sky's dollar stablecoin, the upgraded successor to DAI, backed by overcollateralized on-chain positions.

Is USDS the same as DAI?

Same protocol and collateral system, but separate tokens that convert 1:1.

How big is USDS?

$6.81B on 26 Oct 2026, third among dollar stablecoins (DefiLlama).

What is sUSDS?

The savings version of USDS. It paid 3.80% APY on 26 Oct 2026 (DefiLlama); the rate is variable.

How do I get USDS?

Swap USDC or upgrade DAI on sky.money, or buy it on an exchange.

Is USDS safe?

It has more collateral than supply ($15.89B vs 10.00B combined USDS and DAI, sky.money, 26 Oct 2026), but carries smart contract, collateral and governance risk, and is not insured.

Is USDS regulated under the GENIUS Act?

No. It is not issued by a licensed company, so it is not a GENIUS payment stablecoin.