S&P Global Ratings has assigned a “B” publisher to SKY protocol, previously known as Maker Protocol, which the first time a large agency has spent a rating for a decentralized finance (Defi) platform.
The judgement is part of S&P’s continuous assessment of Stablecoin -Emitents, who began in 2023 to evaluate their ability to maintain a stable value compared to Fiat -Malutas. The assessment includes the creditworthiness of Sky’s liabilities, the USDS (USDS) and DAI (DAI) Stablecoins and the Suss and Sdai Savings -Tokens.
Sky Protocol, evaluated for the first time, received a 4, with the label ‘Limited’, for the capacity of USDS to maintain its PEG to the US dollar. The scale runs from very strong to 5 for weak.
Sky Protocol is a decentralized credit platform with which users can borrow backed loans through cryptocurrency. The USDS Stablecoin, used to facilitate lending and loan transactions, is the fourth largest through market capitalization, with around $ 5.36 billion at the time of writing, according to To Coinmarketcap.
S&P emphasized important risks that can activate a standard, including recordings of deposit that exceed the available liquidity in the PEG stability module and credit losses that exceed the available capital.
Government, capitalization and regulatory risk are the most important concerns
Related: Sky doubles at Token Revision: making MKR unusable, launching Subdaos
The S&P rating pointed to weaknesses in the protocol, including a high concentration of depositors, centralized administration, dependence on the founder, regulatory uncertainty and weak capitalization. These risks were partially compensated by the minimum credit losses and income from the protocol since 2020.
Andrew O’Neil, S&P Global’s Digital Assets Analytical Lead, Cointelegraph said: “A” B- “Rating means that we believe that the protocol can currently meet its financial obligations, but it would be vulnerable in unfavorable business, financial and economic circumstances.”
The Sky Ecosystem Asset-Liability Committee said that the process gave the chance to investigate both traditional counterparty risks and Defi-specific vulnerabilities such as Smart Contract, Oracle, Bridge and Governance Risks.
“Als onderdeel van de interviews en documentatie die we hebben gedeeld met S&P, hadden we de mogelijkheid om enkele van de analytische veronderstellingen achter tegenpartijrisico’s opnieuw te bezoeken en uit te dagen die typerend zijn voor Tradefi, maar niet noodzakelijkerwijs on -chain toepassen, en we hebben ook nieuwe, defecte, risico’s, risico’s, risico’s, overbruggingsrisico’s – die moeten worden gecontroleerd en mitigated,” ze moeten worden Controlled and mitigated, “they must be checked and mitigated,” they must be told, “they must be checked and mitigated,” they must be told and mitigated, “they must be checked and mitigated,” they must be told, “they must be told,” they must be told, “they must be told,” they must be told, “they must be told, Be told and mitigatics, “they must be told and mitigated,” they must be checked and mitel.
Co-founder of Sky Rune Christensen owns almost 9% of the Stokens. The assessment of S&P said: “The protocol’s administrative process remains very centralized because of the rise of low voters during important decisions.”
The capitalization of Sky is another concern. According to the assessment, with a risk-corrected capital ratio of 0.4% from 27 July, the protocol has a limited surplus spare buffer to cover potential credit losses.
The assessment of S&P also reduced the anchor assessment of the protocol to “BB”, four notches under the American bank anchor of “BBB+”, with reference to regulatory uncertainty in the Defi sector.
Stablecoin -publishers under increased control
As cryptocurrency continues to deepen its involvement in traditional financial markets, more institutions within the crypto room are brought into the formal creditworthiness system.
S&P Global launched its Stablecoin Stability Assessment in December 2023. According to the report, Circle USDC (USDC) received a rating of 2 (strong), while Tether (USDT) and USDS arranged 4 (limited).
“The weaknesses of Tether are more about transparency, while USDS has a more complex asset base compared to USDC. And indeed, the relatively weak capital position is also something that drives that relative ranking,” said O’Neil.
The first blockchain-based mortgage security to receive a rating from S&P Global was Figure Technology Solutions, a technology platform that drives a blockchain-based marketplace for financial products. In June, the latest securitization of mortgage assets received a total of $ 355 million, an “AAA” rating from S&P Global.
Magazine: Hong Kong winds Stablecoin Frenzy, Pokémon on Solana: Asia Express
#Global #assigns #creditworthiness #Sky #Defi #protocol