I don’t think we should focus only on the burn in this SKY governance update
I was looking at SKY’s governance update yesterday and found that this proposal is worth examining more closely.
On one hand, it plans to burn around 7.37 million SKY; on the other, it allocates around 99.53 million SKY as staking rewards over 90 days.
It also plans to raise Grove’s debt ceiling from 500 million to 1.5 billion USDS.
At first glance, the burn, incentives, and business expansion are all moving forward.
But I don’t think we should simply interpret these as a pileup of positive catalysts.
The amount burned and the rewards distributed need to be considered separately.
And raising the limit doesn’t mean there will actually be an additional 1 billion USDS in funding demand.
What’s more, this has only passed a governance vote; the earliest it can be implemented is October 12.
What I’m more interested in watching next is how much SKY is actually burned, the pace of reward distributions, and how much of Grove’s expanded capacity will actually be used.
Ultimately, it comes down to whether these businesses can generate revenue sustainably.
The more I research DeFi lately, the more I feel we shouldn’t focus only on how much a project says it will buy back or burn.
Where the funds come from, and how much value ultimately flows back to the token, are what matter more to me.
$SKY #DeFi
I was looking at SKY’s governance update yesterday and found that this proposal is worth examining more closely.
On one hand, it plans to burn around 7.37 million SKY; on the other, it allocates around 99.53 million SKY as staking rewards over 90 days.
It also plans to raise Grove’s debt ceiling from 500 million to 1.5 billion USDS.
At first glance, the burn, incentives, and business expansion are all moving forward.
But I don’t think we should simply interpret these as a pileup of positive catalysts.
The amount burned and the rewards distributed need to be considered separately.
And raising the limit doesn’t mean there will actually be an additional 1 billion USDS in funding demand.
What’s more, this has only passed a governance vote; the earliest it can be implemented is October 12.
What I’m more interested in watching next is how much SKY is actually burned, the pace of reward distributions, and how much of Grove’s expanded capacity will actually be used.
Ultimately, it comes down to whether these businesses can generate revenue sustainably.
The more I research DeFi lately, the more I feel we shouldn’t focus only on how much a project says it will buy back or burn.
Where the funds come from, and how much value ultimately flows back to the token, are what matter more to me.
$SKY #DeFi