Ethena Labs Proposes SOL for a Stronger USDe Foundation

Ethena Labs, the creator of the artificial stablecoin USDe, has proposed the inclusion of Solana (SOL) as a brand new collateral asset in its treasury.
In contrast to conventional stablecoins corresponding to Tether’s USDT or Circle’s USDC, USDe operates as an artificial stablecoin, that means it’s not backed by fiat forex at a 1:1 ratio. As an alternative, USDe maintains its $1 worth by collateralizing varied stablecoins and using a hedged cash-and-carry commerce technique.
This involves taking futures positions with substantial open curiosity, serving to stabilize its worth whereas a reserve fund manages dangers in altering market circumstances.
If authorised by Ethena’s impartial Danger Committee, SOL might be step by step built-in into USDe’s collateral framework, with an preliminary allocation goal of $100-200 million. This quantity would signify about 5-10% of SOL’s open curiosity, mirroring USDe’s present stakes of three% in Bitcoin (BTC) and 9% in Ethereum (ETH).
Moreover, the proposal consists of the potential use of liquid staking tokens (LSTs) like BNSOL and bbSOL, much like Ethena’s present strategy with ETH LSTs, which represent one-third of its ETH holdings.
Lately, Ethena Labs allotted $46 million of its USDe reserve fund for tokenized real-world asset investments in varied tasks, together with BlackRock’s BUIDL, Mountain’s USDM, Superstate’s USTB, and Sky’s USDS. This aligns with the rising development in decentralized finance (DeFi) towards producing yield from asset-backed tokens.
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