Sky faces scrutiny over potential $756M exploit flaw

Sky, formerly known as MakerDAO, is facing criticism for its reliance on an externally owned account (EOA) to manage $756 million in USD Coin reserves within its lite peg stability module (PSM).

Concerns were raised by an X user about the protocol’s reliance on an EOA to manage a substantial portion of its reserves, amounting to $756 million in USD Coin
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Critics argue this custodianship model could leave funds vulnerable to potential exploits or insider misuse.

After its recent rebrand to Sky and concerns surrounding the ability to implement a freeze function in the future, the risk of a breach or misuse of these EOA-managed funds could further impact the protocol’s reputation and user trust.