Proposal: Add USDS deposits/withdrawals as an authorized frontend for Sky DAO (formerly Maker)

Proposals
1

Summary:

Maker DAO now known as SKY is offering up to 0.2% of their 4.75% savings rate as an incentive to frontends to provide access to deposits/withdrawals for their USDS stablecoin.

Proposal:

The SKY team has an impeccable reputation being one of the oldest crypto DAO’s. Per their Atlas they offer fees for those who provide access to deposits/withdrawals and uniquely tag each to identify the source.

A.2.3.8.1.2.1.3.1 - Fee For USDS and sUSDS Balances

The reward recipient is entitled to a 0.1% Accessibility Reward annualized on all USDS and sUSDS balances attributable to them.

A.2.3.8.1.2.1.3.2 - Prime Agent Management Fee

*In addition to the fee specified above, the Prime Agent that Invoked the Accessibility Reward Primitive is entitled to a 0.1% management fee annualized on all USDS and sUSDS balances that use the Reward Code.
*
SKY is a DAO with a billion dollar market cap and maintains the 3rd largest stablecoin with over $15 billion in issuance. They currently payout 100M a year in interest. This thus leaves 4M in income on the table annually for authorized frontends.

A complete guess would be that Lido could obtain 5% of this revenue, approximately $200k a year. This would not be a “get rich” scheme, but would offer Lido extra revenue for minimal effort/risk. It would mostly just require some frontend work. Should this workout, I believe Lido can explore becoming a frontend for borrowing against steth, of which SKY current has $3.2billion deposited with their Spark star (which is like a sub-DAO).

2

Apologies I had planned to submit this then edit it, unfortunately there is no edit button.

I wish to add that Ledger also offers USDS deposits as well as defisaver, summer fi, and others. Lido has offered other products such as SOL staking previously so there is precedent here, and unlike SOL staking, this would be using another dapps backend allowing for minimal effort to implement and maintain the functions. I also believe the Lido dev team is personally acquainted with the SKY team and SKY is considered in the Lido ecosystem as they offer loans against wsteth.

3

What level of technical integration effort would be required for Lido’s frontend to support USDS deposits/withdrawals is it just UI work, or does it involve deeper smart contract interaction?

1 Like
4

This helps explain it further, note that this is slightly old information as previously this program was closed but I believe it’s now open to qualified frontends:

(15) How are Accessibility Rewards calculated and received?

Accessibility Rewards are calculated based on “net USDS deposits,” which represent the USDS attributed to distribution channels as identified via their unique referral code.

The methodology and source code for the attributed USDS calculations can be viewed on this open source Github repository (link deleted as I cannot post with links) maintained by one of the ecosystem calculation agents for Accessibility Rewards.

Accessibility Rewards are managed by the GovOps team and distributed via a monthly cycle to the Ethereum address provided by program participants on enrolment.

Note that the rules are subject to change as the program evolves. Any detected unwanted behavior to misuse the program may cause exclusion from the program without notice, or ineligibility for rewards.

(16) What are the technical integration requirements of the Program?

Stars and/or Integrators will need to support USDS via their frontend or infrastructure.

At least one USDS feature of the Sky Protocol (i.e., USDS Unrewarded, USDS Savings or USDS Token Rewards) will need to be integrated to qualify for receiving Accessibility Rewards.

Participants will be issued an Accessibility Reward Code, which will allow them to tag USDS balances and user transactions that access the Sky Protocol.

(17) How are transactions tagged with the Accessibility Reward Code?

Participants should tag USDS Savings and USDS Token Rewards Transactions with their unique Accessibility Reward Referral Code, as per the following links:

  • USDS Savings contract (link)

  • USDS Token Rewards contract (link)

For Unrewarded USDS balances, the holding address(es) should be provided to be tracked.

1 Like
5

This github helps explain it:
github dot com/stablelab

6

Sorry, wish I could edit posts. I want to answer your question and add that from my understanding it’s mostly frontend work but some minor contract work is required. Lido would also likely want to add the USDC:USDS stability model that swaps USDC for USDS and back 1:1, Sky has 2.2B of USDC to back this up. You can see a good example of this on app dot spark dot fi, likely Lido would also want to have a similar dashboard for sUSDS as it does for steth.

7

How does the Lido team evaluate whether integrating SKY/USDS aligns with Lido’s core focus on ETH staking is this seen as a natural extension, or a distraction from the protocol’s main mission?

8

Now that Lido has added USD deposits, can this proposal go forward to a vote?

9

Hey @misher, spot on with the timing to bring this up with our EarnUSD vault launch !

One of the goals behind both Earn vaults is to provide abstracted UX to our Lido users across DeFi strategies, so from a product perspective it’s less convincing to dilute stablecoin users’ attention on the frontend. I therefore think that a proposal like this is less synergistic at this stage.

Still, as the PO of EarnUSD, i think USDS is a great asset in DeFi nowadays, and I am happy to discuss how we might enable more allocation within EarnUSD to Sky-related strategies - assuming we could find common ground for achieving better yields for our users. At the end of the day, the vault business is really competitive.

That being said, feel free to DM me your TG handle, and let’s connect.

1 Like