Source: PANews
On December 16, the DeFi project Ethena Labs announced the official launch of its new stablecoin USDtb. As a blockchain-based US dollar stablecoin, 90% of USDtb's reserve funds are invested in BlackRock's tokenized fund BUIDL and are in partnership with leading real asset tokenization company Securitize.
On its first day of launch, according to DefiLlama data, USDtb's TVL reached $64.5 million. Previously, Ethena CEO Guy Young predicted that USDtb's TVL in its first month would reach $500 million to $1 billion. He also mentioned that some TradFi entities, although they have not really interacted with other cryptocurrencies, currently have substantial exposure to what Ethena is doing.
Supported by BlackRock BUIDL fund, addressing market volatility in bear markets
The newly launched USDtb is a relatively traditional crypto stablecoin that looks almost identical to USDC and USDT. The only difference is that Ethena uses BlackRock's BUIDL treasury fund as collateral to support this stablecoin. BUIDL is a tokenized fund that invests in assets equivalent to the dollar (such as cash, US government bonds, and repurchase agreements). Ethena does not manage financial assets but entrusts them to different banks or service providers in the real world. Essentially, BlackRock and Securitize are responsible for the entire process. Thus, USDtb's product principle is completely different from Ethena's flagship stablecoin USDe.
Source: PANews
USDtb will serve as an alternative stablecoin for Ethena, absorbing funds from USDe during extreme market conditions. Ethena's CEO Guy Young recently introduced in UnchainedPodcast that USDtb looks very similar to conventional stablecoins, and it itself does not generate yield, so retail users purchasing it will not earn returns like they would with government bond funds. He stated that these two products actually work in parallel, and in 98% of cases, when cryptocurrency exchange rates appear more attractive than traditional finance rates, USDe operates as it does now. Then, to the extent that the environment changes (such as entering a bear market), users always retain the option to close their positions and enter USDtb, maintaining their balance sheet in their own products.
Thus, USDtb may help holders of USDe 'navigate difficult market conditions.' Ethena Labs stated in the announcement on December 16: 'Ethena will be able to close the hedging positions behind USDe and reallocate its supporting assets to USDtb to further mitigate associated risks.'
90% of this stablecoin is supported by BlackRock's BUIDL, in collaboration with blockchain tokenization company Securitize. One of Ethena's committee members, Block Analiticia, noted in an already approved proposal that stablecoins like USDC will account for the remaining 10% of USDtb's reserves, which can provide additional liquidity during weekends or other periods when government bonds cannot be traded. The 'core' part of USDtb's smart contract passed three complete audits by Pashov, Quantstamp, and Cyfrin in October.
USDtb may drive significant funds from TradFi into
Ethena Lab's synthetic stablecoin USDe was launched in February this year and quickly grew to become the third largest stablecoin, following USDT and USDC. Since November 1, just a month and a half ago, its market cap has more than doubled to nearly $6 billion, even surpassing the long-established DeFi native stablecoin $DAI.
Source: PANews
The key to USDe's success lies in the yields it offers. The annual yield for this token is 27%, far exceeding 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 on futures exchanges like Bybit. This creates a so-called 'delta-neutral' position where the value of the assets and the short positions offset each other, thus maintaining overall price stability.
Currently, since most traders are bullish on cryptocurrencies, they pay funds to Ethena to short, while the protocol transfers these funds to USDe holders through staking. As long as this situation continues, the yield of USDe should remain high. However, if traders turn bearish, Ethena will not be able to provide such high yields.
Additionally, the Staked USDe (sUSDe) launched by Ethena is a yield-bearing 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 used. Pendle is the preferred destination for Staked USDe with assets exceeding $1 billion, and Aave ranks second. Ethena CEO Guy Young recently mentioned on UnchainedPodcast that Pendle has about 50% to 60% of its TVL built on sUSDe. Aave has increased its TVL by over $1 billion in a few months.
Returning to the new stablecoin USDtb itself, after the launch of USDtb, Ethena's growth lead Seraphim Czecker stated that Ethena's path is clear:
Integrating conservative TradFi into USDtb
Let them adapt to USDe
Help them understand on-chain opportunities such as Aave, Maker, etc.
José Maria Macedo, one of the founders of blockchain research and development company Delphi Labs, predicts that USDtb will become the largest tokenized government bond product within a month of its launch. Ethena's growth lead Seraphim Czecker stated that USDtb has the potential to expand its functionality to $100 billion, as the company can now effectively allocate capital in a bearish market environment by creating an 'APY floor' around treasury bond rates. 'USDtb will drive a significant flow of funds from TradFi into our industry,' Seraphim summarized.
Currently, Ethena has indeed surpassed a number of crypto-native protocols on various metrics. One of them is that it has consistently been one of the highest fee 'generators.' It has outperformed Tether, Uniswap, Ethereum, Jito, Solana, etc., and has become an important project for DeFi user interactions.
[Disclaimer] The market is risky, and investments should be made cautiously. This article does not constitute investment advice; users should consider whether any opinions, views, or conclusions in this article align with their specific circumstances. Invest at your own risk.
This article is republished with permission from: (PANews)
Original author: Weilin, PANews
'BlackRock Support! What is Ethena's stablecoin USDtb? Can it attract traditional financial funds?' This article was originally published on 'Crypto City'
