Sky, a well-known decentralised finance protocol, will sharply cut the size of its token buyback programme to bolster stablecoin reserves.
DL News reported that the digital cooperative that runs Sky decided in a vote on March 12 to reduce daily buybacks by 87 percent to $37,600 from $300,000. The measure will remain in place for three months.
Sky founder Rune Christensen (룬 크리스텐센) cited the war in Iran as the main reason. He said on a Discord server, "The world will face a large-scale oil shock and much of the financial infrastructure will collapse."
Some critics have said the decision came late.
They said Sky kept buybacks in place even as resources backing its two stablecoins, USDS and DAI, were shrinking.
Over the past 30 days, USDS supply rose more than 22 percent to about $7.9 billion, and DAI increased 2 percent to $4.5 billion. DL News said extra cryptocurrency reserves to stabilise USDS and DAI were flat at about $50 million.
Chi-gyu Hwang
delight@d-today.co.kr