Ethena Launches New Stablecoin Backed by BlackRock’s Treasury Fund

Ethena Labs, a decentralized finance (DeFi) protocol built on the Ethereum (ETH) blockchain, has launched USDtb, its new stablecoin backed primarily by BlackRock's BUIDL money market fund.

USDtb is designed to maintain a 1:1 peg with the U.S. dollar, with over 90% of its reserves held in BlackRock's BUIDL fund and the remainder in other stablecoins. Since going live on Dec. 16, USDtb has amassed a total value locked (TVL) of over $70 million, according to DeFiLlama data.

Ethena's latest offering highlights a broader trend in DeFi towards integrating real-world assets (RWAs) for enhanced stability and greater institutional adoption. It also signals the growing convergence of traditional finance and digital assets, experts said.

"In light of the rapidly accelerating demand for different stablecoin options, we saw a clear opportunity to provide a new product that offers users an entirely different risk profile from USDe without them having to leave our trusted ecosystem,” Ethena founder Guy Young said.

USDe, Ethena’s flagship stablecoin, is a synthetic dollar that maintains its $1 peg using a derivative-based trading strategy. USDe captures funding rate differences between spot and futures markets but can struggle when funding rates turn negative. However, USDtb can help stabilize USDe during bear markets, Ethena explained in a blogpost.

"During periods of negative funding rates, Ethena will close the hedging positions backing USDe and reallocate its assets to USDtb to mitigate associated risks," the company explained.

Additionally, Ethena envisions USDtb as a potential alternative to USDe for margin collateral on centralized exchanges it has partnered with, as well as any future exchanges that may offer similar programs.

In addition to Ethereum mainnet, USDtb will be available on Base, Solana, and Arbitrum through LayerZero, with bridging capabilities provided by Stargate. The reserves will be securely held by custodians such as Copper, Zodia Custody, Komainu, and Coinbase Institutional.

The stablecoin market has experienced significant growth in 2024, with its market cap reaching $204 billion, a 77% increase since the beginning of the year, according to DeFiLlama. Tether (USDT) continues to dominate, accounting for approximately 69% of the sector.

“The new USDtb stablecoin provides another layer of legitimacy for the Web3 space, and follows other high profile examples like PayPal, which launched their own dollar-backed stablecoin last year, designed to facilitate more efficient cross-border transactions,” said Shant Kevonian, CEO and Founder of EtherMail.

Kevonian added that roughly 30% of global remittances are now facilitated through stablecoins, noting that USDtb is a great example of crypto innovations delivering tangible change.

"This is a continuation of the biggest trend in stablecoins over the last few years: backing stablecoins by treasury bonds and passing that yield through to stablecoin holders. I think these 'RWA stablecoins' will see a lot more growth in the next few years, and it may put pressure on the big incumbents to share more of their revenue with their customers," said Rhett Ship, the founder and CEO of Avant.