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The old OG was doing well, why did MakerDAO suddenly change its name?

深潮TechFlow

24-08-28 12:12

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Original title: "MakerDAO changes its name to Sky, the old OG plays a new brand but leaves the community confused"

Original source: TechFlow

Let me introduce you to a new project called Sky.

When this word appears, in addition to the sense of unfamiliarity, do you think that this ordinary and common name should correspond to a dog project that will be able to take to the sky tomorrow?

It is hard to imagine that this is a brand renaming by MakerDAO, the pioneer of DeFi and crypto stablecoin DAI.

On August 27, MakerDAO announced its plan to change its name to Sky and upgrade its own tokens and stablecoins to the new names SKY and Sky Dollar (USDS).

From MakerDAO to Sky, it is not only a change in name, but also a change in brand recognition.

For applications that are significant enough, it is very difficult to take a word away from the user's mind. For example, you may still be accustomed to calling a social media software Twitter instead of X, and calling tweets and CT instead of "posts on X".

MakerDAO's position in the crypto ecosystem may be no less than that of Twitter in social media.

So, knowing that it is not easy, what changes will the new Sky have, and why did it change its name?

What changes have occurred in the business and assets?

What users are most concerned about is whether the assets will be affected after MakerDAO changed its name to Sky.

According to Sky’s latest official push, the original MKR and DAI tokens will be upgraded to new SKY and USDS (Sky Dollar) tokens. This upgrade process follows the following rules:

1. MKR to SKY conversion:

Each MKR can be exchanged for 24,000 SKY tokens. This ratio is fixed, which means that MKR holders will receive a corresponding number of new governance tokens SKY after the conversion.

2. DAI to USDS Conversion:

The conversion ratio between DAI and USDS will be 1:1. This means that every 1 DAI held by the user can be directly converted into 1 USDS, ensuring the continuity of the stablecoin value.

It is worth noting that this token upgrade is voluntary. Users can choose whether to convert their MKR and DAI to the new token. This gives community members more options.

For users holding MKR, they will maintain the corresponding governance rights after converting to SKY. Sky promises that the new governance model will be more efficient and transparent.

At the same time, Sky has provided a user-friendly migration tool to help users easily complete the conversion process from old tokens to new tokens.

However, judging from the official website, it seems that only more than 370 users have made this migration so far, and the education and promotion of the community is still facing certain resistance.

In order to make everyone more willing to migrate to the new SKY token, the team announced an additional reward mechanism. For users who complete the token migration during the beta period, they will receive 1.25 times the SKY and USDS token rewards.

Why the name change?

For most people, the name change of MakerDAO seems a bit abrupt, and some negative voices have appeared in the community.

For example, although the name was changed to Sky, the old Twitter account @MakerDAO did not seem to be cancelled and properly handled. Instead, an unknown small account called MakerDAO was registered by others and played with memes.

In the comment area of Sky’s official name change announcement, in addition to simple congratulatory comments, opposition voices are also common.

The well-known KOL @stacy_muur asked three soul-searching questions:

"MakerDAO is a good brand, what's the problem? Why are you so keen on rebranding? Why are you hurting mature brand recognition?"

So, why did Sky change its name? Perhaps we can find clues in a blog post by MakerDAO co-founder Rune Christensen as early as May "Reconciling the Two Opposing Paths for Decentralized Stablecoins".

In this article, Christensen elaborated on the key challenges and future development directions facing MakerDAO, laying the groundwork for the name change:

1. Dealing with regulatory pressure

Christensen mentioned in the article that decentralized stablecoins are facing unprecedented regulatory pressure. Especially in the United States, regulators are taking an increasingly harsh attitude towards cryptocurrencies, especially stablecoins. In this environment, MakerDAO needs to reposition itself to adapt to the changing regulatory landscape. The name change to Sky may be to draw a line with its past identity and create greater flexibility for future development.

2. Technical upgrade and reconstruction

The article actually points out that MakerDAO needs to undergo a major technical upgrade. This includes improving smart contracts, optimizing governance mechanisms, and enhancing the scalability of the system.

So the logic is that the name change to Sky is not just a change in the brand, but also represents a comprehensive innovation of the underlying technical architecture. For crypto projects, generally such a radical change requires a brand new brand image to reflect it, such as Fantom's Sonic.

3. Large-scale adoption requires new brand recognition

In order to make stablecoins more well-known and adopted by more people, compliance with regulations is a prerequisite, but simplifying brand recognition is equally important. The name "MakerDAO" may seem obscure to people outside the cryptocurrency circle. "Sky" is simple and easy to remember, which helps to attract a wider user group, especially those who are not familiar with cryptocurrency.

Brand upgrades in groups, a new fashion for crypto?

In fact, MakerDAO is not the only one engaged in brand upgrades.

In the past one or two years, the name change of crypto projects has gradually become a new fashion phenomenon.

When old coins are boring and speculators want something new, it always sounds more exciting to change the brand name, create a new token symbol, and start over with a new price curve.

For example, Fantom became Sonic, several AI projects such as FET merged into ASI, Galaxy changed its name to Galxe and then became Gravit... Brand renaming is common in the crypto market.

Figure: TechFlow

According to statistics from a recent case study of crypto token upgrades and mergers, brand renaming, token migration or mergers do not guarantee immediate and/or long-term positive price trends.

Therefore, projects must ensure that there are sufficient reasons and solid evidence to support "why migration or merger". Only in this way can they gain logical and business legitimacy and leave a correct reason for the hype of tokens.

MakerDAO's transformation into Sky obviously follows the crypto fashion phenomenon of brand renaming.

But whether its tokens and business development will be qualitatively improved, and whether the substance will remain unchanged after all the appearances have been changed, still needs time to give an answer.