A governance proposal within the Sky ecosystem aims to double the USDC Peg Stability Module (PSM) buffer from $400 million to $800 million, enhancing the protocol's capacity to handle large stablecoin conversions. The proposal, submitted on June 11, 2026 by risk advisor BA Labs, targets the LITE-PSM-USDC-A module, which serves as the primary venue for swaps between Sky’s DAI stablecoin and USDC.
The adjustment would raise both the pre-minted DAI buffer and the DC-IAM gap parameter, expanding daily refresh capacity to $1.6 billion and total serving capacity to $2.4 billion. This comes as the module's USDC reserves have surged to $4.13 billion, a 108% increase since the last recalibration in October 2024. Historical data reveals massive outflows, including a record $1.75 billion DAI redeemed on May 18, 2026, highlighting the need for a larger liquidity cushion.
The proposal must pass a formal executive vote on June 12, 2026, where Sky governance token holders will decide on the parameter change. If approved, the update would be implemented via an on-chain executive spell, reducing the risk of manual interventions during periods of high redemptions and strengthening the protocol's resilience.
