Sky’s $4.4 billion liquidity disclosure shows why USDS cash-outs need a separate bank route

Sky.money reported more than $4.4 billion of stablecoin liquidity in its Peg Stability Module in an Oct. 9 explanation of the conversion mechanism. The PSM gives holders a direct route between USDS, Sky Protocol’s dollar-linked token, and USDC at a one-for-one rate.Those measures answer different questions. Token circulation describes the stock of holdings. Conversion inventory describes what a holder can receive on a particular exit route. Fresh external dollar demand concerns money entering from outside the token system. Borrowing against collateral and upgrading an existing token can change individual token counts without establishing a matching inflow of bank dollars. A swap through existing inventory moves liquidity between holders or token forms; it does not by itself establish new issuance.Sky describes direct USDS–USDC conversion in both directions through liquidity already held inside the protocol. The mechanism supplies the conversion itself, so it does not need to find another trader willing to take the opposite position.At the settings described in the October explanation, the direct PSM leg has no protocol swap fee or slippage. A routed trade can still incur costs else...