- Ethena Labs launches USDe on Solana, integrating SOL as a potential backing asset pending governance approval.
- Solana users can earn rewards with Ethena’s sUSDe and Sats through new partner protocol integrations.
Ethena Labs has taken a huge step forward by launching its stablecoin, USDe, on the Solana blockchain. This deployment is a watershed moment, made possible by the collaboration with LayerZero Labs Omnichain Fungible Token (OFT).
With this integration, Solana’s native cryptocurrency, SOL, has been included as a backing asset for USDe; however, this is still subject to governance approval. This step not only increases the usability of USDe on Solana, but also opens up new ways for consumers to interact with the ecosystem.
USDe is live on Solana as of today, August 7th
Read below for a list of our app integrations with USDe and sUSDe 👇 pic.twitter.com/vik1qESbN5
— Ethena Labs (@ethena_labs) August 7, 2024
Solana Users Gain New Opportunities with USDe and SOL Integration
One of the most notable parts of this deployment is the ability for Solana users to not only transact in USDe, but also earn incentives using Ethena’s native rewards token, sUSDe.
This is especially important in light of the present stablecoin situation on Solana, where more than 90% of the $3.5 billion in stablecoin supply does not let users get rewards. Ethena Labs’ method represents a significant shift in how stablecoins can be used on the Solana network.
The proposal to include SOL as a backing asset for USDe, which will be submitted for governance approval next week, could increase USDe’s scalability. USDe is ready to become significantly more integrated into the Solana ecosystem by leveraging the $2–3 billion in open interest across key exchanges.
The addition of SOL as a backing asset also opens up the possibility of improved scalability, as Ethena intends to gradually scale into SOL while closely monitoring funding rates.
SOL’s year-to-date (YTD) performance in 2024 has been particularly excellent, with funding rates outperforming both Bitcoin (BTC) and Ethereum (ETH), even after ETFs for the latter two currencies were introduced.
This positive trajectory, paired with Ethena’s conservative expansion strategy, shows that SOL could be a significant asset within the USDe framework.
In addition to the deployment on Solana, Ethena Labs has introduced multiple opportunities for users to earn Satoshis (Sats) on Solana, beginning August 5th, including interfaces with partner protocols such as Kamino, Orca, Drift, and Jito.
These integrations are intended to increase users’ earning potential inside the Solana ecosystem, hence strengthening Ethena’s market position.
Meanwhile, USDe underwent a big “stress test” this week, with redemptions totaling roughly $100 million. This test demonstrates the strength of Ethena’s synthetic dollar and its capacity to endure market pressure.
Furthermore, as we previously noted, Ethena Labs recent cooperation with Bybit has enabled users to earn up to 20% APR on USDe collateral, making it one of the most appealing USD-denominated assets accessible on Bybit.
This agreement also allows for fee-free trading and daily rewards, which increases USDe’s appeal to both traders and investors.
On the other hand, according to a prior CNF report, Ethena Labs has also introduced a proposition in which asset issuers can ask for allocations from its liquid cash backing.
One of the first petitions for this distribution came from Securitize, a BlackRock partner, who wanted a portion of Ethena’s reserve reserves. This proposal demonstrates Ethena’s dedication to growing its ecosystem and creating new opportunities for revenue creation.
Meanwhile, at the time of writing, Ethena’s native token, ENA, has risen 8.79% over the last 24 hours to $0.3046, with a daily trading volume of $50.69 million. And SOL is currently trading at $156.77, up 1.92% over the same period, with a daily trading volume of $4.78 billion.
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