Sky token's price jumped 10% after a governance vote that got the market feeling positive about

Sky's SKY Token Jumps 10% as Protocol Slashes Emissions, Launches Buyback, Expands Credit

Sky's native token, SKY—yeah, the one from the project formerly known as Maker—just had a pretty good day. It popped nearly 10% after the protocol put a governance proposal into action. The plan? Slow down how many new tokens get created via staking rewards, beef up the lending system around its USDS stablecoin, and keep buying back its own tokens from the market in a big way.

The proposal passed on February 27 and actually went live on March 2. It's got a bunch of moving parts, but the main ones are tweaking staking rewards and rolling out new credit infrastructure to get USDS in front of more people.

One of the biggest things people are watching is the staking reward change—basically, how fast new tokens are being minted and given to folks who lock up their SKY to support the network.

Slowing Down the Supply Hose The idea here was to "normalize" SKY staking emissions. They set a new distribution schedule: about 838 million tokens over the next 180 days. That's roughly 162 million fewer tokens than the old plan. Less issuance means less dilution, and that's the kind of thing token holders tend to like.

But that's not all. The protocol's also been on a buying spree. There's an automated buyback program funded by USDS, and according to Sky's own dashboard, it's already spent around $114.5 million to scoop up about 1.83 billion SKY tokens from the market.

These buy orders aren't huge lumps—they're spread out through the day, usually around $10,000 a pop—but they add up. They create a steady bid in the market. Right now, the program is pulling roughly 3.6 million SKY out of circulation every single day.

Combine those buybacks with the lower emissions, and you've got a tighter supply situation. Data from the protocol shows about 67% of all SKY is currently staked, meaning only a fraction is actually floating around being traded.

The governance proposal also greenlit some new infrastructure to help build out the credit market around Sky. Two new "Launch Agents" are being brought in to help deploy credit and manage the liquidity stuff tied to the USDS stablecoin system.

This Is Part of a Bigger Story What Sky is doing isn't happening in a vacuum. Across crypto, more and more projects are moving away from the old DeFi playbook of high inflation and massive token giveaways. Instead, they're pivoting to models based on buybacks and lower emissions.

Back in the day, protocols would shower users with newly minted tokens to attract liquidity and participation. It worked to get networks off the ground, but it also meant constant selling pressure, since people would often just dump those rewards.

Now, the trend is reversing. Instead of printing more, protocols are using their revenue to buy back tokens from the open market, or just cutting back on how many new tokens they create.

Take Hyperliquid. That DEX uses a chunk of its trading fees to buy back and burn its HYPE tokens. Last week, when trading went nuts, they pulled in over $13 million in weekly fees and burned about $9 million worth of tokens in seven days.

Or look at Jupiter, a Solana-based project. They voted in February to kill net new issuance of their JUP token for all of 2026, so no extra supply is hitting the market. And dYdX, the derivatives protocol, approved a plan to funnel 75% of its revenue into buying back its own tokens.

This whole shift is about tying a token's value more directly to what's actually happening in the protocol, while making sure existing holders aren't getting constantly diluted.