# Sky Reports More Than $4.4 Billion in Peg Stability Liquidity

By Enna Lee

Canonical URL: https://www.tokenpost.com/news/investing/31161
Published: 2026-10-13T13:18:15.000Z
Updated: 2026-10-13T13:18:15.000Z
Section: Investing

> The Peg Stability Module converts USDS and USDC at 1:1, but bank-dollar redemptions require a separate USDC route and compliance checks.

Sky’s Peg Stability Module held more than $4.4 billion in liquidity as of Oct. 9, 2026, separating the amount available for USDS-USDC conversion from the bank cash accessible through a separate redemption process.

The module provides two-way USDS and USDC conversions at a 1:1 rate. Sky does not impose swap fees or price slippage on direct PSM conversions, but users may still incur blockchain network charges.

Because the liquidity is held within Sky Protocol, a conversion does not require another trader to take the opposite side. The balance can be checked through the Sky Ecosystem Financial Dashboard and changes over time.

The conversion ends with USDC rather than a bank deposit. A USDS holder seeking dollars must use a separate USDC redemption route operated by Circle or an eligible intermediary. That process can require identity verification, transaction checks, sanctions screening and confirmation of banking details.

For retail holders in the European Economic Area, the redemption process requires a bank account capable of receiving U.S. dollar payments. After the required verification, the process should take no more than five business days unless discrepancies are identified. The applicable policy was updated Sept. 15, 2026.

That timetable applies to the EEA retail policy and does not establish the same processing timeline for U.S. residents or every other redemption route.

Circle Mint is an institutional service through which businesses can exchange dollars and USDC. It is separate from the retail redemption process.

The distinction matters when evaluating stablecoin balances. The more than $4.4 billion figure represents aggregate liquidity for USDS-USDC conversions, not a guaranteed amount of bank cash that every holder can withdraw simultaneously.

Stablecoin supply growth also does not necessarily equal an equivalent inflow of new dollars into crypto markets. Tokens can change denominations, be borrowed against collateral or migrate from legacy contracts without creating a matching external bank deposit.

Uniswap routing has been able to use Sky’s LitePSM for the USDC-USDS portion of eligible routes since July 8, 2026. Other portions of a multistep trade remain subject to normal market pricing, liquidity and fees.