BlackRock’s BUIDL Token Provides Foundation for Ethena’s Stablecoin

Ethena Launches USDtb Stablecoin to Strengthen Ecosystem Stability Amid Market Fluctuations

Ethena, one of the fastest-growing decentralized finance (DeFi) platforms, unveiled its new stablecoin, USDtb, on Monday, aimed at providing greater stability to its ecosystem, particularly during bearish market conditions. The stablecoin will be backed primarily by BUIDL, BlackRock’s tokenized money market fund, in partnership with Securitize, and will aim to maintain a steady $1 peg.

“In response to the increasing demand for alternative stablecoin solutions, USDtb offers our users a distinct risk profile compared to our flagship token, USDe,” said Ethena founder Guy Young in a statement. “This new product allows us to manage market risks while keeping our trusted ecosystem intact.”

Protecting Against Market Downturns

Ethena’s USDe token, which offers yield generation by shorting major cryptocurrencies like Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) in the form of perpetual swaps, has seen impressive yields during bullish market cycles. However, when the market turns bearish, the associated negative funding rates can turn the strategy unprofitable. To mitigate this, Ethena introduced USDtb to shift the backing of USDe into USDtb during periods of negative funding, ensuring a safer store of value for users.

Custody and Liquidity Partners Ensure Security

To back the new stablecoin, Ethena has enlisted high-profile custodians, including Coinbase Institutional, Copper, Komainu, and Zodia Custody, ensuring security and trust in the reserves. Additionally, liquidity for USDtb will be provided by major players like Jump Trading, Amber Group, GSR Markets, and SCB Limited.

Furthermore, Ethena is aiming to get USDtb recognized as collateral for margin trading on centralized exchanges and has applied for Sky’s Tokenization Gran Prix program, which could see up to $1 billion invested in tokenized real-world assets (RWA).

Rising Momentum for ENA Token

Ethena’s governance token, ENA, saw a significant price increase over the weekend after World Liberty Financial, a DeFi project with ties to President-elect Donald Trump, purchased $500,000 worth of ENA tokens. This boosted the price of ENA by 25%, although it later corrected slightly on Monday.

A Strong Road Ahead

Ethena has become one of the most prominent players in the DeFi space, accumulating nearly $6 billion in user funds since its launch in 2024. The launch of USDtb further enhances its position in the market, offering new ways for users to protect their investments in fluctuating markets. With strategic partnerships, innovative offerings, and a growing user base, Ethena’s future in the DeFi space looks strong.