The transfer goals to reverse Ethena’s dropping market capitalization.
Artificial stablecoin startup Ethena Labs is broadening its attain within the crypto trade by integrating Solana and partially backing its flagship ‘synthetic dollar’ USDe with SOL. The mixing is being facilitated by the cross-chain interoperability protocol LayerZero.
Solana customers can now purchase, ship, and obtain USDe on Solana and doubtlessly accrue rewards by way of sUSDe, the staked model of the token. Ethena Labs has additionally added SOL as an asset to again USDe, becoming a member of Bitcoin, which was added in early April as a collateral asset.
USDe holders on Solana may also earn Ethena sats by staking USDe on Kamino, Orca, and Drift.
“Given Solana’s standing as the third largest blockchain by TVL, Ethena is confident that this integration will significantly increase the adoption of USDe and sUSDe – providing a whole new market of traders with a reward-accruing asset in sUSDe that substantially improves upon the traditional stablecoin experience,” reads a launch shared with The Defiant.
Declining Market Capitalization
The transfer to combine with Solana may very well be a strategy to deal with Ethena’s dropping market capitalization.
In line with CoinGecko, USDe’s market cap is down 14% to $3.1 billion from $3.6 billion in early July. That also lands the stablecoin in fourth place amongst stablecoins, behind USDT, USDC, and DAI.
ENA, the challenge’s native token which launched in April at a $1 billion market cap with an airdrop for early adopters, now sits at half that dimension, solely 4 months later. It trades for $0.27, having shed 33% of its worth prior to now 30 days, in accordance to CoinGecko.
Ethena Labs made waves when it launched its artificial greenback, USDe, because of its excessive yield and novel mechanism to defend the token’s peg.
USDe primarily backs its token (which is pegged to $1) with staked Ethereum, whereas additionally hedging its stETH holdings with quick ETH positions on centralized exchanges. Each stETH and the quick positions contribute to yield that’s handed on to USDe stakers.
The mannequin has been lauded by many within the crypto neighborhood–whereas additionally triggering LUNA PTSD for its double-digit yield.
