MakerDAO Considers Reverting Sky Rebrand as SKY Token Struggles to Gain Traction

TLDR:

• MakerDAO considering abandoning Sky rebrand after lukewarm reception
• SKY token underperformed with only 8% of MKR tokens converted
• USDS stablecoin launch successful with $1.2B supply and 6.5% savings rate
• Community shows strong preference for original Maker brand
• Formal governance vote scheduled for November 4th on brand direction

MakerDAO, a leading decentralized finance protocol, is considering abandoning its recent Sky rebrand after receiving mixed feedback from the community and experiencing underwhelming token performance.

The protocol’s founder, Rune Christensen, announced that a formal governance vote will take place on November 4 to determine the project’s brand direction.

The rebranding initiative, which cost approximately $25 million in combined DAI and MKR tokens, has faced several challenges since its implementation.

Most notably, the SKY token, introduced as a replacement for the MKR governance token, has significantly underperformed market expectations. Data shows that only 8% of MKR tokens have been converted to SKY tokens, indicating a strong reluctance from holders to embrace the new system.

Market Performance and Token Migration

The SKY token’s performance has been particularly concerning, with a 23% decline in value over the past two weeks while the CoinDesk 20 index gained 10%.

This stark contrast in performance has raised questions about the effectiveness of the rebranding strategy. The MKR token has also struggled, showing a 24% decrease year-over-year.

Despite the challenges with the SKY token, the protocol’s new USDS stablecoin has shown promising results. Launched in August, USDS has achieved a supply of $1.2 billion and currently offers a 6.5% savings rate. The stablecoin’s success demonstrates that certain aspects of the Sky ecosystem have gained traction within the DeFi community.

Community Response and Exchange Adoption

A significant setback for the SKY token has been its limited adoption by centralized exchanges (CEXes). Christensen acknowledged this as a “typical DeFi mistake,” noting that he had underestimated the importance of CEX listings for liquidity and adoption.

Community members have pointed out that the lack of recognition from major platforms like Coingecko has been a clear indicator of the rebrand’s challenges.

Christensen has presented three potential options for the protocol’s future:

1. Continue building with Sky as the core brand
2. Return to the original Maker brand and reinstate MKR as the sole governance token
3. Develop a refreshed version of the Maker brand that incorporates elements of the current ecosystem

User feedback has consistently emphasized strong affinity for the original Maker brand, with many community members expressing that while they appreciate the USDS stablecoin, they see no need to alter the established Maker identity. This sentiment has played a crucial role in prompting the upcoming governance vote.

The protocol plans to host a community call to gather additional feedback before the formal governance poll begins on November 4. This vote will determine whether MakerDAO maintains its current path or returns to its original branding strategy.