Ethena to launch stablecoin backed by BlackRock fund

Key facts:
  • BUIDL is the largest tokenized US Treasury bond fund.

  • Ethena already issues another stablecoin, USDe.

Ethena, a company known in the cryptocurrency ecosystem for its stablecoin USDe, has announced the launch of a new stablecoin, UStb, in collaboration with Securitize, a real-world asset tokenization platform.

This new stablecoin will be supported by BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL), which has become the largest tokenized US Treasury bond fund. with more than USD 522 million in assets under management since its launch in March of this year.

UStb is designed to operate similarly to traditional stablecoins, maintaining a constant value of 1 US dollar. UStb’s reserves will be invested in dollars, short-term US Treasury bills and repurchase agreements. This approach differs from its predecessor, USDe, which uses hedging strategies with derivatives based on crypto assets such as bitcoin, ether and solana to maintain its parity with the dollar.

Securitize, which has facilitated over $950 million in tokenized investments, plays a crucial role in this launch, having previously worked with BlackRock and other major financial institutions such as Hamilton Lane and KKR.

UStb will be a “fully independent product” from USDe, offering an alternative risk profile, according to Ethena. This diversification could help the firm navigate adverse market conditions, allowing it to hedge USDe positions. and reallocate assets to UStb if conditions require.

The Ethena team has expressed that UStb could also serve as a margin guarantee in centralized exchanges, thus expanding its usefulness beyond mere value parity (a characteristic maintained by all stablecoins, as read in Criptopedia, the educational section of CriptoNoticias).

This movement follows a 44% increase in the price of ENA, Ethena’s governance token, over the past seven days, reaching $0.35 before a 13% surge following the announcement, standing at $0.37.

ENA price reacted positively following the stablecoin announcement. Source: CoinMarketCap.

UStb’s entry into the stablecoin market comes amid a backdrop of dominance by major players such as USD Tether (USDT) and USD Coin (USDC), but also aligns with a growing trend of other major financial and technology entities exploring or launching their own stablecoins, such as Société Générale and Revolut, suggesting a growing interest in diversifying and expanding the stablecoin ecosystem.


This article was created using artificial intelligence and edited by a human on the editorial staff.

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