Standard Chartered Bank has initiated research coverage on the decentralized finance network Sky, previously known as MakerDAO, projecting that the value of its native SKY token will climb fivefold to reach $0.325 by the close of 2028, up from its current valuation near $0.065.
The financial institution refers to Sky as the “federal bank of DeFi” due to its role in issuing stablecoins, establishing governance frameworks, and levying wholesale interest rates on borrowers.
Geoffrey Kendrick, global head of digital assets research at Standard Chartered, explained in a Friday publication that in traditional finance, Sky would function similarly to a central bank by producing currency like USDS and DAI, setting regulatory parameters for participants, and lending capital at wholesale rates. He added that these participants act like commercial banks that borrow at those wholesale terms and deploy the funds elsewhere to capture an interest margin.
Kendrick pointed out that Sky’s three primary operational agents—Spark, Grove, and Obex—have collectively borrowed a total of $5.9 billion in USDS. These entities channel the capital into yield-generating strategies while remitting a baseline interest rate to Sky, which currently sits at 3.8%.
Spark concentrates on decentralized lending via protocols including Aave and Morpho. Grove channels funds into real-world assets through offerings from companies such as BlackRock, Janus Henderson, and Apollo. Obex integrates specialized capital allocators directly into the Sky ecosystem.
Kendrick also mentioned that Sky generates revenue from USD Coin holdings managed through Coinbase inside its peg stability module—which facilitates conversions between USDS and USDC—alongside income derived from legacy DAI-backed cryptocurrency lending vaults.
He anticipates expansion within Sky’s USDS stablecoin operations alongside an increased proportion of profits being directed toward token holders through staking incentives and token buybacks.
Kendrick stated that the value distributed by Sky to holders of the SKY token is projected to expand five times over by the end of 2028, fueled by the broader scaling of both the Sky network and circulating USDS supply. Assuming all other variables remain constant, this growth should trigger a fivefold appreciation in the price of SKY.
Furthermore, Kendrick noted that these projections suggest SKY will roughly mirror the price performance of ether while outperforming bitcoin leading up to the conclusion of 2028.
How expected growth could benefit SKY token holders
Kendrick’s forecast unfolds in two distinct phases. Initially, Sky is expected to distribute a larger portion of its current earnings once a more substantial financial buffer is established. Subsequently, an increase in USDS borrowing volumes could expand the total income available for distribution.
At present, Sky maintains approximately $90 million within its reserve buffer, formally designated as aggregate backstop capital. The platform retains a fraction of its earnings specifically to fortify this reserve.
Kendrick estimated that maintaining the current accumulation rate would allow the buffer to hit $150 million within roughly eight months. If the reserve also scales to 1.5% of the total circulating USDS supply, the funds allocated for SKY buybacks and staking yields could potentially double.
Additional expansion may stem from lending activities. Spark, Grove, and Obex currently hold a combined borrowing threshold of $17.5 billion, representing nearly triple their active debt. Tapping into those maximum credit limits could unlock an additional two- to threefold boost in revenue, provided that interest spreads remain stable.
This price projection also relies on the assumption that SKY’s staking yield, currently standing at 4.2%, will hold steady near that benchmark. Under that framework, enhanced rewards would sustain a higher market valuation for the token. Kendrick characterized SKY primarily as a yield-staking asset, with token buybacks serving a secondary function.
On a macro level, Kendrick maintains his forecast that the wider stablecoin sector will achieve a valuation of $2 trillion by late 2028, though he remains less certain about the exact share of demand that will flow into yield-bearing stablecoin models, such as those provided by Sky and Ethena.
He cautioned that the primary downside risk to this outlook would materialize if the adoption rate of yield-bearing stablecoins falls short of current expectations.
Originally published at https://www.theblock.co/news/markets/2026-09-11-standard-chartered-sky-token-defi-federal-bank-414280.
