Sky Completes First SKY Burn, Permanently Removes 2.86 Million Tokens
Summary
- Sky said it completed the permanent burn of 2.86 million SKY after buying the tokens on the market with protocol revenue.
- Sky said it allocates 50% of monthly Net Protocol Surplus to SKY- and USDS-related rewards and token purchases.
- Sky said the first burn shows a mechanism linking the protocol's financial performance to a reduction in SKY supply has begun operating.
Sky has completed its first SKY token burn using protocol revenue.
On Sept. 14, Sky wrote on X that it had permanently burned 2.86 million SKY tokens bought on the open market using 5% of its monthly Net Protocol Surplus.
The burn is part of Sky's "Stage 2" capital allocation framework. Under that system, Sky allocates 50% of monthly Net Protocol Surplus to SKY- and USDS-related rewards and token buybacks.
Specifically, 22.5% of net surplus is used to buy SKY for SKY staking rewards, while another 22.5% is used for USDS staking rewards. The remaining 5% is allocated to buying SKY on the market and burning it.
Sky said the first burn shows a mechanism has begun operating that links the protocol's financial performance with a reduction in SKY supply.
Minseung Kang
minriver@bloomingbit.ioBlockchain journalist | Writer of Trade Now & Altcoin Now, must-read content for investors.