Ethena Labs announced the launching its USDtb stablecoin, which will use BlackRock’s tokenized fund, USD Institutional Digital Liquidity Fund (BUIDL), for 90% of its support.
According to the December 16 announcement, the partnership was made possible by Securitize.
USDtb will operate independently of Ethena’s existing algorithmic stablecoin, USDe, providing users and exchange partners with a stablecoin with a differentiated risk profile. Ethena’s Risk Committee has also approved USDtb as a potential support asset for USDe, increasing its ability to navigate volatile market conditions.
The USDtb design provides flexibility and risk mitigation across the Ethena ecosystem and beyond, while Spark’s $1 billion Tokenization Grand Prix encourages incentives to be sent to the stablecoin. The initiative will boost tokenization efforts.
Furthermore, USDtb is inherently multichain, built as LayerZero’s Omnichain Fungible Token (OFT). Users can transfer USDtb to various blockchains such as Ethereum, Base, Solana and Arbitrum.
USDtb’s liquidity will be supported by leading market makers, among others JumpCumberland, WintermuteAmber, GSR and SCB Limited.
Ethena Labs’ move represents an important step forward for stablecoins in particular, which combine the stability of traditional finance with the efficiency and scalability of blockchain. BlackRock’s BUIDL currently has a market cap of almost $562 million.
Furthermore, it consolidates Ethena’s position in the stablecoin market following its success algorithmic stablecoin USDe, which grew 93% in the last 30 days and reached a market cap of $5.6 billion – making it the third largest stablecoin on the market.
The growth could be closely linked to the value accumulation mechanism, which at the time of writing gives USDe stakers an annualized return (APY) of 27%.
TradFi meets DeFi
Besides Ethena Labs, other DeFi protocols are also considering tapping BUIDL.
Money market platform Aave suggested a new GHO Stability Module (GSM) on August 26 based on BlackRock’s tokenized fund. Aave created the GSM to help maintain the peg of its ecosystem’s stablecoin, GHO.
Meanwhile, BlackRock plans to expand its BUIDL offering for traditional financial giants. The asset manager is considering using the shares of its tokenized fund as collateral for derivatives trading.
Such a step would Connect the trillion-dollar derivatives market to the emerging tokenized money fund industry, which is about $3 billion as of December 16.
