Tether Backer Joins $134M Private Placement for SKY

Tether confirmed it participated in a $134 million private placement for Stablecoin Development Corporation (SDEV). The funding round closed in January and combined a 943.6 million SKY token deposit with $25 million in cash and $51 million in stablecoins used to acquire an additional 1.17 billion SKY tokens.

SDEV was formed through a merger with NovaBay Pharmaceuticals and began trading on the NYSE American under the ticker SDEV in early April. Investors in the private placement received warrants to purchase SDEV common stock. Other participants in the round included R01 Fund LP, Sky Frontier Foundation and Framework Ventures.

As of March 31, SDEV held about 2.15 billion SKY tokens, roughly 9.15% of the token’s total supply. The company also participates in Sky’s staking ecosystem and has earned about 26.6 million SKY tokens to date, valued at nearly $2 million.

SDEV holds SKY, the governance token for the Sky Protocol, and uses Sky’s USDS stablecoin as part of its operating strategy. Sky, previously known as MakerDAO, issues USDS, which is the third-largest stablecoin by market capitalization and the largest stablecoin that operates fully onchain.

SDEV describes its purpose as providing public market investors structured exposure to stablecoins and related decentralized finance activity and studying how stablecoins and DeFi are used in practice and how to reduce friction for users.

Paolo Ardoino, Tether’s chief executive officer, wrote in a statement: “Stablecoins are already being used far beyond trading, especially in places where traditional systems don’t work well. What matters now is making that infrastructure more reliable and easier to use, so people can rely on it day to day. The next phase of adoption will be driven by systems that make digital assets practical and accessible for everyday use.”

The private placement’s mix of token deposits, cash and stablecoins increased SDEV’s SKY holdings and aligned investor stakes with Sky’s governance and stablecoin ecosystem. SDEV’s holdings and staking rewards provide both governance exposure and an onchain revenue stream tied to activity on the Sky network.