Ethena Partners With Derive, sENA Holders To Receive 5% of DRV Supply

Ethena has teamed up with the decentralized options protocol Derive, allowing sENA holders to claim 5% of Derive’s native token.

On Dec. 3, Ethena announced it inked a partnership with Derive, the decentralized options protocol formerly known as Lyra. The partnership includes Derive onboarding support for Ethena’s stablecoin, USDe, as yield-bearing collateral for options trading, alongside the launch of a USDe-based structured product.

The Ethena Foundation said it provided a “multi-million dollar grant” to Derive as part of the agreement. Derive will also airdrop 5% of the supply for its upcoming governance token, DRV, to holders of staked ENA (sENA) — the staked version of Ethena's governance token.

“Ethena’s partnership with Derive.xyz marks the latest step in its journey to establish itself as an incubator and launchpad for the projects that will underpin DeFi’s next chapter,” Ethena said. "We're proud of the opportunity to power the largest on-chain options protocol, which will unlock new structured product financial primitives.”

Derive emphasized that the deal allows it to tap into Ethena’s multi-billion dollar asset ecosystem, facilitating the creation of derivatives and structured products around USDe. Derive said it will also explore building the first options market for ENA.

Ethena said Derive boasts a more than 75% market share of the on-chain options market for BTC and ETH, drives approximately $250 million in weekly volume, and hosts more than 50,000 users.

The price of ENA is up 46% over the past seven days, according to The Defiant’s crypto price feeds.

Ethena Network

The partnership makes Derive the second project to join the Ethena Network ecosystem following Ethereal, a decentralized exchange supporting spot and perpetual futures markets.

Ethena's governance approved the Ethereal partnership on Oct. 4, greenlighting Ethereal integrating “Ethena-related reserve management… to provide a fully on-chain venue for management of spot and derivative positions backing USDe.” Ethereal will also distribute 15% of its future governance token's supply to sENA holders.

Holders of sENA are now earning points from both Ethereal and Derive.

USDe growth

The Derive partnership follows USDe enjoying rapid market growth USDe yields rise alongside bullish market momentum.

USDe yields are derived from a combination of Ether staking rewards hedged against short funding rates for ETH. With funding rates for short positions recently exceeding 53%, Ethena estimates (sUSDe) holders are earning an annual percentage yield (APY) of 29%.

The high yields have propelled market cap growth of 98% since mid-October, with USDe now boasting a capitalization of $4.78 billion and ranking as the fourth-largest stablecoin. The number of USDe holders has also increased by 10,000 since Nov. 25 to exceed 320,000.