Written by: TechFlow
Let me introduce you to a new project called Sky.
When this word appears, besides the feeling of unfamiliarity, you may feel that this ordinary and common name should correspond to a local dog project that can be launched into the sky tomorrow.
It’s hard to imagine that this is a brand renaming by MakerDAO, the pioneer of DeFi and crypto stablecoin DAI.
On August 27, MakerDAO announced its plan to rebrand to Sky and upgrade its own tokens and stablecoins to the new names SKY and Sky Dollar (USDS).
From MakerDAO to Sky, it is not just a change in name, but also a change in brand awareness.
For an application that is significant enough, it is very difficult to remove a word from the user's mind. For example, you may still be accustomed to calling a certain social media software Twitter instead of X, and calling it tweets and CT instead of "posts on X".
MakerDAO's position in the crypto ecosystem may be no less than that of Twitter in social media.
So, knowing that it is not easy, what changes are there in the new Sky and why was it renamed?
What changes have occurred in the business and assets?
What users are most concerned about is whether their assets will be affected after MakerDAO is renamed Sky.
According to Sky’s latest official announcement, the original MKR and DAI tokens will be upgraded to new SKY and USDS (Sky Dollar) tokens. This upgrade process follows the following rules:
MKR to SKY Conversion:
Every 1 MKR can be exchanged for 24,000 SKY tokens. This ratio is fixed, which means that MKR holders will receive a corresponding number of new governance tokens SKY after the conversion.
DAI to USDS conversion:
The exchange ratio between DAI and USDS will be 1:1, which means that every DAI held by the user can be directly exchanged for 1 USDS, ensuring the continuity of the stablecoin value.
It is worth noting that this token upgrade is voluntary. Users can choose whether to convert their MKR and DAI to new tokens. This gives community members more choices.
For users holding MKR, they will maintain corresponding governance rights after converting to SKY. Sky promises that the new governance model will be more efficient and transparent.
At the same time, Sky has provided a user-friendly migration tool to help users easily complete the conversion process from old tokens to new tokens.
However, judging from the official website, it seems that only more than 370 users have completed this migration so far, and there is obviously still some resistance to community education and promotion.
In order to make everyone more motivated to migrate to the new SKY token, the team announced an additional reward mechanism. Users who complete the token migration during the beta period will receive 1.25 times the SKY and USDS token rewards.
Why change the name?
To most people, MakerDAO’s name change seems a bit abrupt, and some negative voices have emerged in the community.
For example, although the name was changed to Sky, the old Twitter account @MakerDAO did not seem to be cancelled or properly handled. Instead, an unknown small account called MakerDAO was registered by others and used as a meme.
In the comment section of Sky's official name change announcement, in addition to simple congratulatory comments, voices of opposition were also common.
Well-known KOL @stacy_muur asked three soul-searching questions:
"The MakerDAO brand is fine, what's the problem? Why are you so keen on rebranding? Why are you damaging the mature brand recognition?"
So, what is the reason for Sky’s name change? Perhaps we can find clues in a blog post by MakerDAO co-founder Rune Christensen in May titled “Reconciling Two Conflicting Paths to Decentralized Stablecoins.”
In this article, Christensen elaborated on the key challenges and future development directions facing MakerDAO, laying the groundwork for the name change:
Responding to regulatory pressure
Christensen mentioned in the article that decentralized stablecoins are facing unprecedented regulatory pressure. Especially in the United States, regulators are taking an increasingly harsh attitude towards cryptocurrencies, especially stablecoins. In this environment, MakerDAO needs to reposition itself to adapt to the changing regulatory landscape. The name change to Sky may be to draw a line with the past identity and create greater flexibility for future development.
Technology upgrade and reconstruction
The article actually points out that MakerDAO needs major technical upgrades. This includes improving smart contracts, optimizing governance mechanisms, and enhancing the scalability of the system.
So the logic is that the name change to Sky is not just a brand change, but also represents a comprehensive innovation of the underlying technical architecture. For crypto projects, such a radical change generally requires a completely new brand image to reflect it, such as Fantom's Sonic.
Mass adoption requires new brand awareness
In order to make stablecoins more well-known and adopted, compliance with regulations is a prerequisite, but simplifying brand recognition is equally important. The name "MakerDAO" may seem obscure to people outside the cryptocurrency circle. "Sky" is simple and easy to remember, which will help attract a wider user group, especially those who are not familiar with cryptocurrency.
A cluster of brands upgrading to create a new fashion?
In fact, MakerDAO is not the only one engaged in brand upgrading.
In the past one or two years, the name change of crypto projects has gradually become a new fashion phenomenon.
When old coins are boring and speculators want something new, it always sounds more exciting to be able to change the brand name, create a new token symbol, and start over with a new price curve.
For example, Fantom became Sonic, several AI projects such as FET merged into ASI, Galaxy was renamed Galxe and then became Gravit... Brand name changes are common in the crypto market.
Image: TechFlow
According to statistics from a recent case study of crypto token upgrades and mergers, brand changes, token migrations or mergers do not guarantee immediate and/or long-term positive price trends.
Therefore, the project must ensure that there are sufficient reasons and solid evidence to support "why migration or merger". Only in this way can it obtain logical and business legitimacy and leave a correct reason for the hype of the token.
MakerDAO's transformation to Sky clearly follows the crypto fashion phenomenon of rebranding.
However, it will still take time to answer whether its token and business development will see a qualitative improvement, and whether the substance remains the same after all the superficial changes.
