Ethena Labs Plans to Integrate USDe on Deribit Exchange

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As a seasoned crypto investor with over a decade of experience in this ever-evolving market, I find the recent announcement by Ethena Labs about the integration of USDe on Deribit derivatives exchange intriguing. The potential to earn rewards while holding and using USDe as margin collateral is certainly an attractive proposition for many traders.

I’m excited to share that Ethena Labs is planning to integrate USDe into their system, offering rewarding margin collateral on the Deribit derivatives exchange. This means that Deribit users will now have the opportunity to earn rewards for holding USDe, all while continuing to use it as derivative margin collateral in cross-collateral pools. The current 24h volatility stands at a manageable 0.2%, and with a market cap of $3.77 B and a volume of $243.77 M over the past 24 hours, USDe is a significant player in the market.

Based on reports from the derivatives exchange, their goal is to incorporate USDe into its shared collateral pool as soon as possible, likely by early January. However, this schedule may change if regulatory approval is not granted in time.

Utilizing USDe and Its Benefits

Users can collect rewards simply by keeping USDe on hand and utilizing it as collateral for derivatives margins within a combined collateral pool. They also have the option to incorporate USDe into single or multiple exchange derivative strategies while earning rewards through holding the synthetic dollar. Notably, leading exchanges such as Bybit, Bitget, and Gate already support USDe as margin collateral.

Guy Young, founder of Ethena Labs, explained that combining USDe within the interconnected collateral pool opens up entirely novel structured product scenarios unattainable on centralized exchanges using traditional stablecoins as collateral.

Over time, Young anticipates that this integration will prove crucial for showcasing the uses of USDe. This belief is rooted in Deribit’s significant dominance, holding 85% of the market share in the options sector. Furthermore, he is excited about the prospect of USDe integration on the derivatives exchange, a move that could draw both traditional financial (TradFi) and cryptocurrency-native trading firms to this platform.

The recent announcement about integration has sparked an upward trend in the price of the Ethena token (ENA). This token serves as a governing element within the Ethena ecosystem. As per CoinMarketCap, the current price of ENA is approximately $0.6019, representing a 3.73% surge over the past 24 hours. Furthermore, its trading volume has significantly increased by 45.59%, currently standing at around $428.45 million.

For the past 30 days, ENA has approximately registered a 70% usage of Solana (SOL), with a current value of $255.4 and a daily volatility of 2.5%. The market capitalization is at $121.24 billion, while the 24-hour trading volume stands at $11.31 billion. Ethena Labs suggested integrating Solana as collateral for USDe last month.

Ethena Labs Comes Up with UStb Stablecoin

Beyond US Dollar-backed digital currency (USDe), Ethena has been actively involved in developing a fresh stablecoin initiative, known as USTB (UStb). This token is partnering with the asset management giant BlackRock Inc (NYSE: BLK) and Securitize. In simpler terms, Ethena is working on a new form of digital currency called USTB which is collaborating with BlackRock Inc (a well-known asset management firm listed on NYSE as BLK) and Securitize.

Approximately two months ago, the protocol unveiled a fresh project, stating that UStb will operate similarly to conventional stablecoins. The intention is to allocate its funds into BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL), which has been tokenized on Ethereum.

Ethena Labs characterized the UStb stablecoin as a standalone entity, separate from its current USDe product. This means that they carry distinct risk profiles. However, introducing the new UStb stablecoin could potentially benefit USDe during challenging market situations.

The Ethena Labs team explained:

If Ethena’s leadership deems it necessary and suitable, during times when funding rates are negative, Ethena may choose to liquidate its hedging positions associated with USDe and instead invest its reserves in UStb. This action is intended to reduce potential risks.

In simpler terms, Ethena aims to make UStb a possible substitute for USDe when it comes to providing collateral for trading margins on the exchange partners like Bybit and Bitget.

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2024-11-22 19:15