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Decentralized finance (DeFi) protocols Aave and Sky (formerly Maker) are considering a strategic partnership aimed at bridging the gap between decentralized finance and traditional finance. The initiative, known as the Sky Aave Force, was announced on September 2 and follows a governance proposal by Phoenix Labs, a research and development organization in the DeFi space.
The proposed collaboration involves issuing SPK tokens, which are native to Sky’s subDAO, Spark. These tokens would be used to establish a market for USDS, a stablecoin introduced after Maker’s rebranding to Sky in August. According to Aave Labs, the goal of the partnership is to drive mass adoption and create synergy between DeFi and traditional financial systems.
Phoenix Labs' proposal includes distributing up to 3.33 million {SPK} tokens each month to incentivize the creation of an Aave v3 market for Sky’s sUSDS. This yield-bearing token represents deposits in Sky’s Savings Rate (SSR) program, which functions similarly to the DAI Savings Rate (DSR) program from the previous Maker setup. The SSR program provides yield to depositors based on the revenue generated by Sky’s protocol.
The proposal highlights that idle sUSDS on Aave would consistently earn the Sky Savings Rate (SSR), positioning the market to potentially outperform stablecoins like USDC and USDT. Additionally, the proposal suggests the introduction of a USDS Direct Deposit Module (D3M) to Aave’s Lido Market, with an initial debt ceiling set at $100 million. This follows Aave’s July partnership with Lido to create a lending market for wstETH, a liquid staking derivative.
The D3M would allow Sky to mint USDS directly into Aave’s market, bypassing the standard collateral requirements. With Aave being the largest lending market in DeFi, holding over $11 billion in total value locked (TVL) across multiple chains, this partnership is expected to leverage synergies between the two protocols.
Phoenix Labs views this collaboration as a preliminary step toward a deeper relationship with Aave, aiming to position both protocols at the core of scalable DeFi solutions.
