Article reprinted from: Weilin
Author: Weilin, PANews
On December 16, the DeFi project Ethena Labs announced the official launch of its new stablecoin USDtb. As a blockchain-based dollar stablecoin, 90% of USDtb's reserve funds are invested in BlackRock's tokenized fund BUIDL and partnered with leading real asset tokenization company Securitize.
On its launch day, the TVL of USDtb reached $64.5 million according to DefiLlama data. Previously, Ethena CEO Guy Young predicted that the TVL for USDtb in its first month would reach between $500 million and $1 billion. He also noted that some TradFi entities, although not truly engaged with other cryptocurrencies, currently have significant exposure to what Ethena is doing.
Supported by the BlackRock BUIDL fund to cope with market fluctuations in a bear market
The newly launched USDtb is a relatively traditional crypto stablecoin that looks almost identical to USDC and USDT. The only difference is that Ethena supports this stablecoin using BlackRock's BUIDL treasury fund as collateral. BUIDL is a tokenized fund that invests in assets equivalent to dollars (such as cash, U.S. Treasury securities, and repurchase agreements). Ethena does not manage financial assets but entrusts them to different banks or service providers in the real world. Essentially, it allows BlackRock and Securitize to be responsible for the entire process. Thus, USDtb is fundamentally different in product principles from Ethena's flagship stablecoin USDe.
USDtb will serve as an alternative stablecoin for Ethena, absorbing funds from USDe in extreme market conditions. Ethena's CEO Guy Young recently mentioned on the Unchained podcast that USDtb looks very similar to regular stablecoins and does not inherently generate yield, so retail users purchasing it will not earn returns as they would with treasury bond funds. He stated that these two products actually operate in parallel, and in 98% of cases, when cryptocurrency exchange rates appear more attractive than traditional financial rates, USDe operates as it does now. Then, to the extent that the environment changes (for example, entering a bear market), users always have the option to close (positions) and switch to USDtb while retaining their balance sheet in their own products.
Thus, USDtb may help USDe holders 'navigate tough market conditions.' Ethena Labs stated in a December 16 announcement: 'Ethena will be able to close the hedge positions behind USDe and reallocate its supporting assets to USDtb to further mitigate related risks.'
The stablecoin is 90% backed by BlackRock's BUIDL and partnered with blockchain tokenization company Securitize. One of Ethena's council members, Block Analiticia, noted in an already approved proposal that stablecoins like USDC will constitute the remaining 10% of USDtb's reserves, which can provide additional liquidity during weekends or other periods when treasury markets are not tradable. The 'core' part of USDtb's smart contract passed three full audits by Pashov, Quantstamp, and Cyfrin in October.
USDtb is likely to drive significant capital from TradFi into
Ethena Lab's synthetic stablecoin USDe was launched in February of this year and has since rapidly grown, now being the third largest stablecoin after USDT and USDC. Since November 1, just a month and a half ago, its market capitalization has more than doubled to nearly $6 billion, even surpassing DAI, the historically significant DeFi native stablecoin.
The key to USDe's success lies in the yield it offers. The annual yield of this token is 27%, significantly higher than the 12.5% offered by DAI and USDS. USDe is created by depositing Bitcoin, Ethereum, or Solana into the Ethena protocol and then opening short positions (bearish) on futures exchanges like Bybit. This creates a so-called 'delta neutral' position, where the value of the asset and the short position offset each other, maintaining overall price stability.
Currently, due to the bullish sentiment of most traders towards cryptocurrencies, they are paying Ethena to short, while the protocol transfers these funds to USDe holders through staking. As long as this situation continues, the yield on USDe should remain high. However, if traders turn bearish, Ethena will not be able to provide such high yields.
In addition, Ethena's Staked USDe (sUSDe) is a yield token that allows users to earn additional returns by staking USDe tokens. Through staking rewards and basis trading strategies, sUSDe provides high yields for holders.
Blockworks Research recently published on Twitter about the different ways Ethena is primarily utilized. Pendle is the preferred destination for Staked USDe with over $1 billion in assets, while Aave ranks second. Ethena CEO Guy Young recently mentioned on the Unchained podcast that approximately 50% to 60% of Pendle's TVL is built on sUSDe. Aave has added over $1 billion in TVL within a few months.
Returning to the new stablecoin USDtb itself, after the launch of USDtb, Ethena's growth director Seraphim Czecker stated that Ethena's path is very clear:
- Incorporate conservative TradFi into USDtb
- Help them adapt to USDe
- Help them understand on-chain opportunities like Aave and Maker with USDe
One of the founders of blockchain research and development firm Delphi Labs, José Maria Macedo, predicts that USDtb will become the largest tokenized treasury product within a month of its launch. Ethena's growth director Seraphim Czecker stated that USDtb has the potential to expand to $100 billion because the company can now effectively allocate capital in a bearish market environment, achieving this by 'creating an APY floor around treasury yields.' 'USDtb will drive a significant amount of capital from TradFi into our space,' Seraphim concluded.
Currently, Ethena has indeed surpassed a number of crypto-native protocols in many different metrics. One of them is that it has consistently been one of the highest fee 'generators'. It has repeatedly surpassed Tether, Uniswap, Ethereum, Jito, Solana, etc., and has become an important project for DeFi user interaction.
