– S&P Global Ratings assigned a historic ‘B-‘ credit rating to DeFi stablecoin protocol Sky Protocol, equivalent to the Republic of Congo’s sovereign debt level.
– The rating highlights risks from Sky’s centralized governance (9% control by co-founder) and liquidity vulnerabilities due to concentrated depositors.
– S&P warned of potential downgrades from smart contract flaws, regulatory shifts, or market shocks like liquidity crunches within 12 months.
– Despite concerns, S&P acknowledged Sky’s 2020 operational resilience and noted improved governance/decentralization could boost future ratings.
– This marks institutional recognition of DeFi’s growing financial relevance, potentially spurring stricter evaluation frameworks for stablecoins.
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