Sky Launches Native USDS on Avalanche via Skylink Bridge

Sky Protocol has submitted a weekly cycle proposal focused on maintaining efficiency in its rate framework as the ecosystem continues to grow. The proposal is part of an ongoing effort to optimize protocol operations and ensure sustainable scaling. This follows previous governance initiatives from May that introduced structural upgrades to strengthen capital protection and improve the staking rewards model. **Key Points:** - Weekly rate framework adjustment proposal submitted - Aims to maintain efficiency during ecosystem growth - Continues Sky's focus on long-term protocol stability Full details available in the [governance forum](https://forum.skyeco.com/t/atlas-edit-weekly-cycle-proposal-week-of-2026-07-20/28062).

Sky Protocol has absorbed a cost reduction that directly improves profitability for Sky Agents across its network. The move widens margins on existing capital allocations and makes previously unprofitable strategies viable. **Key Impact:** - Lower deployment costs across the ecosystem - Improved economics for all 12 independent Sky Agent teams - Supports continued network growth and capital efficiency The change comes as Sky operates one of crypto's strongest network effects with **$10B in stablecoin supply**, **$5B in sUSDS**, and **$14B in collateral**. The protocol recently hit record revenue run rates and distributed over $250M in cumulative sUSDS yield. Sky Agents like Spark, Grove, and Securitize deploy USDS capital across diversified strategies including onchain lending, tokenized Treasuries, and institutional credit. Each pays Sky Protocol a base rate, funding the Sky Savings Rate currently at 3.60% APY. The cost reduction strengthens the economic model that has attracted institutional players like BlackRock, Janus Henderson, and PayPal to deploy billions through the network.

Sky Governance is proposing to reduce the Base Rate margin from SSR + 0.3% to SSR + 0.2%. **What This Means:** - The Base Rate is the wholesale cost of capital that Sky Agents pay to borrow USDS - It's set by Governance as a fixed margin over the Sky Savings Rate (SSR) - The narrower spread lowers borrowing costs for all Sky Agents - This creates more room for profitable capital allocation across the ecosystem **Impact:** Every Sky Agent will pay less to access capital, potentially improving their ability to deploy funds efficiently.

Grove now provides the capital infrastructure behind Galaxy's institutional loan origination platform. The arrangement is secured by: - The full loan portfolio - Crypto collateral pledged for each individual loan This marks another institutional counterparty building on USDS capital, expanding the stablecoin's presence in institutional lending markets. **Background**: Galaxy operates across trading, asset management, investment banking, and venture investing in digital assets. The firm previously adopted Aave for treasury management, utilizing features like permissionless 24/7 liquidity access and savings GHO (sGHO) for yield on idle stablecoin balances.

Spark has partnered with Robinhood to power the platform's new Earn product, bringing stablecoin yield to 28 million users. **Key Details:** - USDS serves as the core mechanism for generating yield - Sky Savings Rate now accessible through Robinhood's platform - Partnership demonstrates how regulated institutions can offer native stablecoin savings without building infrastructure from scratch **Technical Foundation:** Spark recently built a shared liquidity network on Uniswap v4 where stablecoin issuers connect to common pools rather than creating separate infrastructure. USDS functions as the central routing mechanism, meaning network growth strengthens USDS demand. **Market Significance:** The launch signals a trend where institutions combine specialist infrastructure providers with allocation intelligence to create stablecoin financial products. This approach allows regulated financial institutions to enter the stablecoin savings market efficiently. The integration makes non-custodial stablecoin savings accessible to mainstream users through a familiar platform. [Read full breakdown](https://paragraph.com/@spark-11/why-robinhoods-usdg-launch-matters-beyond-crypto-earn?referrer=0xA45F1D29943D19dff604133287047a35ccbADc8a)