Rune Christensen Defends Sky’s Freeze Function Amid Decentralization Concerns
Rune Christensen, co-founder of Sky, addresses community concerns over the possible freeze function in the $USDS stablecoin, stressing governance and compliance needs.
Key points:
- Freeze function concerns: $USDS stablecoin may include a freeze function, sparking centralization fears.
- Regulatory compliance: Christensen says it’s essential for managing real-world assets and legal obligations.
- Governance-led decisions: The community will vote on whether to enable the freeze function.
- Sky Stars governance: The new subDAO system allows regional regulatory compliance with decentralized governance.
- No forced migration: $DAI and $MKR will continue alongside $USDS, with shared liquidity.
Christensen Defends Freeze Function as Compliance Tool:
Rune Christensen’s announcement that Sky’s $USDS stablecoin might include a freeze function has sparked debates. Concerns about Sky’s potential centralization grew after the news.
The freeze function won’t be activated when $USDS launches on September 18. However, the possibility of it being used later raised alarms in the DeFi community.
Christensen defended the idea, arguing that as DeFi integrates real-world assets, regulatory engagement is necessary. The freeze function would help meet compliance needs, especially in cases of suspicious transactions.
He pointed out that stablecoins like $USDT and $USDC already use similar tools to meet legal requirements.
To calm fears, Christensen assured users that the community would vote before enabling the freeze function. The new subDAO system, called Sky Stars, allows local governance and regional compliance. This keeps the protocol adaptable while maintaining decentralization.
Read more: Maker Rebrands to Sky and Prepares for USDS Stablecoin Launch
Christensen also confirmed that Sky will continue to support $DAI and $MKR. Users can stay with the existing system without disruption or choose the new $USDS options.
