Sky Burns 2.86 Million SKY Tokens in First-Ever Supply Reduction
The Sky protocol completed its first token burn, permanently eliminating 2.86 million units acquired on the open market using the ecosystem’s own funds.
The operation used 5% of the monthly Net Protocol Surplus allocated to buybacks and burns, one of the three capital allocation mechanisms defined in Stage 2 of the protocol.
The first SKY burn is complete.
2.86M SKY, purchased on the open market using 5% of monthly Net Protocol Surplus, has been permanently removed from circulation.
The link between protocol performance and reductions in SKY supply is now active. pic.twitter.com/6a9VTsuVmy
- Sky (@SkyEcosystem) September 14, 2026
Under that framework, 50% of the monthly net surplus is distributed across SKY buybacks for staking rewards —22.5%—, staking rewards in USDS —another 22.5%— and the aforementioned burn program —the remaining 5%—.
The protocol thus links its financial performance directly to permanent reductions in SKY’s circulating supply, complemented by recurring purchases on the secondary market and an incentive system for those who maintain staking positions.
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