Ethena to Launch New Stablecoin UStb, Backed by Blackrock’s BUIDL Tokenization Fund
Ethena has announced a strategic collaboration with asset tokenization platform Securitize to introduce a new stablecoin product named UStb. Designed similarly to traditional stablecoins, UStb will have its reserves invested in Blackrock’s “Tokenization Fund” BUIDL.
Strengthening Stability and Asset Allocation
The design of UStb aims to provide users with a reliable and secure digital asset, backed by Blackrock’s BUIDL. By leveraging the collateralization of UStb within BUIDL, it enhances hedging capabilities and optimizes asset allocation strategies. This initiative not only showcases Ethena’s commitment to innovation but also highlights the growing importance of stablecoins in the cryptocurrency ecosystem.
Blackrock’s BUIDL Fund Overview
Blackrock’s BUIDL Fund invests in US dollars, short-term US Treasury securities, and repurchase agreements. Since its launch in March this year, BUIDL has rapidly evolved into the largest tokenized US Treasury fund, managing assets exceeding $522 million.
Innovative Product Offering
Described as a “completely independent product,” UStb will serve as an alternative to Ethena’s existing stablecoin USDe, presenting distinct risk profiles. It will offer users and exchange partners a new product with differentiated risk scenarios compared to USDe.
USDe vs. Traditional Stablecoins
Unlike traditional stablecoins, USDe employs derivative hedging strategies rather than direct fiat currency or asset backing. It relies on collateralization with Ethereum, Bitcoin, Solana, and other cryptocurrencies, maintaining its peg to the US dollar through arbitrage-based minting and redemption mechanisms, generating revenue through a cash carry trade strategy.
Market Resilience and Integration
In challenging market conditions, UStb can assist USDe in maintaining stability. Ethena’s team explains that during negative interest rate periods, they can liquidate the hedge positions of USDe and reallocate the backed assets to UStb to further mitigate related risks.
Future Integrations and Exchange Adaptations
Ethena plans to use UStb as collateral for its partnered centralized exchanges, including Bybit and Bitget. Specific release dates and exchange integration details will be announced in the upcoming weeks.
Disclaimer: This article is for informational purposes only. All content and opinions are for reference purposes and do not constitute investment advice, nor do they represent the views and positions of Block. Investors should make their own decisions and trades, and the author and Block shall not be liable for any direct or indirect losses resulting from investor transactions.
Further Reading
Bitcoin Spot ETF Records Six Consecutive Days of Net Inflows, Bitcoin Poised for Largest September Gain. 10x Research: Bitcoin to Reach $70,000, Expected to Hit New All-Time High Soon.
