TheBlock
Standard Chartered initiated coverage of Sky, the DeFi protocol formerly known as MakerDAO, on Friday with a fivefold price target for the SKY token. Analyst Geoffrey Kendrick, the bank's global head of digital assets research, projects SKY rising to $0.325 by the end of 2028 from about $0.065 today, a path he expects to roughly match Ether's gains and outperform Bitcoin through the same window.
Why it matters
Kendrick frames Sky as "DeFi's federal bank" because it issues stablecoins (USDS and its predecessor DAI), sets governance rules, and lends at a wholesale rate to three operating agents: Spark, Grove, and Obex. Those agents have collectively borrowed $5.9 billion in USDS at a base rate of 3.8%, then routed the funds into yield strategies, including crypto lending through Aave and Morpho (Spark), real-world asset allocations with managers such as BlackRock, Janus Henderson, and Apollo (Grove), and specialist capital allocators (Obex).
That structure, issuer plus rate-setting plus commercial-bank-style borrowers, is the read that justifies the multiple. It is also the first time a Tier-1 global bank has assigned a structured target and a central-bank analogy to a single DeFi native protocol.
Market impact
The thesis rests on two stages. Sky holds roughly $90 million in its reserve buffer, which Kendrick expects to grow to about $150 million within eight months at the current pace. Once that buffer reaches 1.5% of USDS outstanding, distributions to SKY stakers and buybacks could double. A second lever is borrowing capacity: Spark, Grove, and Obex have a combined $17.5 billion ceiling, almost three times current usage, which could multiply distributable income two- to threefold at constant spreads.
The forecast assumes SKY's staking yield stays near 4.2%. Kendrick continues to see the broader stablecoin market reaching $2 trillion by 2028, but flags slower-than-expected yield-bearing stablecoin growth as the main downside risk.
Frequently asked questions
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What is Standard Chartered's price target for SKY?
Analyst Geoffrey Kendrick projects SKY to reach $0.325 by the end of 2028, a roughly 5x increase from its current price near $0.065. He expects the token to match ETH's gains and outperform BTC through the same period.
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Why does Standard Chartered call Sky 'DeFi's federal bank'?
Kendrick frames Sky as a DeFi central bank because it issues stablecoins (USDS and DAI), sets governance rules, and lends at a wholesale interest rate to operating agents that deploy the borrowed funds across yield strategies.
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How much have Sky's three operating agents borrowed in USDS?
Spark, Grove, and Obex have collectively borrowed $5.9 billion in USDS at a 3.8% base rate, then routed the funds into crypto lending, real-world asset allocations, and specialist capital strategies.
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What is the upside scenario for SKY token holders?
If Sky's reserve buffer reaches 1.5% of USDS outstanding, SKY staker distributions and buybacks could roughly double. Pushing agent borrowings toward the combined $17.5 billion ceiling could multiply distributable income another 2x to 3x at constant spreads.
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What is the main risk to Standard Chartered's SKY forecast?
Kendrick's main downside risk is slower-than-expected growth in yield-bearing stablecoins, which would weaken the income distribution thesis that supports his 5x price target by end-2028.
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