As a longtime Maker watcher (and often critic), I am absolutely shocked by this @SPGlobalRatings for Maker-Sky 1) B- is deep in junk territory, implying S&P assigns >12% chance of default within 3 years 2) Sky is reposting, which suggests lack of understanding what B- means

I will begin by saying I agree with S&P’s critiques around governance, asset quality, and regulatory risk. Directionally correct but too far. A company with a rating one notch HIGHER than Maker-Sky received has a pretty high risk of default.

Countries w B- include 🇦🇴, 🇵🇰, & 🇸🇻 Microstrategy also at the B- level I do not view USDS/DAI as a risk peer to those

This is particularly an unfortunate rating bc the “anchor rating” was BB, meaning that’s where S&P started and Maker-Sky was found to warrant being lowered 4 more notches to hit B- rating

Were I @SkyEcosystem I would be aggressively communicating w S&P as I tried to improve my rating, even though S&P says an upgrade is “highly unlikely in the next 12 months”

Quite frankly, this is a disastrous rating for a major stablecoin. If you believe USDS/DAI is a B- asset, you are probably not being paid for it. Bonds rated a notch higher pay 7%. That’s the risk-adjusted hurdle to clear with your USDS. Obviously the 4.75% savings rate doesn’t

@agusscapdevila @SPGlobalRatings They started at BB and lost 4 notches. I think that’s excessive, but also stablecoins rely on reputation and soundness. They need higher ratings than a regular DeFi protocol