Ethena Labs announced on X on September 26 its newest product offering, UStb. The company revealed that UStb would be backed up by BlackRock BUIDL. Ethena Labs also revealed that BlackRock would partner with Securitize to enable a separate fiat stablecoin.
Ethena Labs launched its new stablecoin on its official X page on September 26. The company also announced that a new product offering, UStb, would be fully backed by BlackRock in collaboration with Securitize.
Ethena Labs launches new stablecoin with Securitize and BlackRock
Ethena Labs stated that UStb would operate as a wholly independent product from USDe. It highlighted that the new product would offer traders and users a differentiated risk profile from their synthetic dollar, USDe.
UStb will be collateralized by @BlackRock and @Securitize BUIDL and will function identically to a traditional stablecoin
This will exist as an isolated product separate from USDe offering users and exchange partners a new product with a differentiated risk profile to USDe
— Ethena Labs (@ethena_labs) September 26, 2024
USDe reportedly uses hedging strategies that utilize cryptocurrencies as collateral, exposing it to market volatility. As such, Ethena Labs acknowledged an initial concern surrounding USDe regarding how it responded to negative funding rate environments.
The company noted that despite bearish conditions, the protocol has not endured any negative funding in the last six months.
Ethena Labs stated that USDe could benefit from incorporating the new stablecoin UStb during weak funding conditions. The company highlighted that if need be, USDe backing composition could adjust between liquid stable positions and basis positions in diverse interest rate environments.
Ethena Labs also added the governance may decide to relocate USDe’s backing assets to UStb in negative funding periods to mitigate volatility risks.
The company also highlighted its intention to list UStb on more centralized exchanges such as Bitget and Bybit. By doing this, Ethena Labs noted it would offer exchange partners the choice of two collaterals.
Ethena Labs closed by saying more details on the new stablecoin would be revealed in the coming weeks.
ENA Price skyrockets in response to new stablecoin launch
According to CoinMarketCap data, Ethena Labs’ governance token, ENA, experienced a price surge shortly after Ethena Labs announced the launch of the new stablecoin. The coin is currently trading at $0.3544, a 13% increase in the last 24 hours as of the time of writing.
ENA’s trading volume has also increased in the last 24 hours, with notable increased buying activity reaching approximately $196.1 million. ENA traded mainly in Bybit, Coinbase, and Binance exchanges.
USDe was launched in February 2024 and has gained popularity, making it the fifth-largest stablecoin. According to CoinMarketCap, the stablecoin has a total circulating supply of $2.6 billion.
Ethena’s latest developments reportedly attracted notable investors, such as Dragonfly Capital. Bybit, OKX, and Gemini. The company is said to have raised over $14 million in a strategic funding round earlier this year. According to Guy Young, Ethena’s founder, the round raised Ethena’s valuation to $300 million.
