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Ethena, Securitize Target Q2 Mainnet Launch for RWA-Focused Blockchain, Tap Arbitrum, Celestia

Decentralized finance (DeFi) protocol Ethena and tokenization firm Securitize said they will use part of Arbitrum’s tech and data availability network Celestia for their real-world asset focused, Ethereum-compatible blockchain, aiming to launch mainnet in the second quarter of this year.

The Converge chain is setting out to have fast blocktimes, allowing users to pay gas fees through Ethena’s USDe and USDtb, while creating security and guardrails via its Converge Validator Network, the two protocols behind the project explained in a tech update shared with CoinDesk.

“The idea is that we go on a testnet very soon, in the next few weeks, because we’ve already been working on this for a while,” Carlos Domingo, co-founder and CEO of Securitize, said in an exclusive interview with CoinDesk. “Then, the mainnet: the goal is to do it before the end of Q2.”

The exact timing of the public rollout also depends on third-party integrations such as Anchorage for custody support, Fireblocks for key management and other DeFi apps the project partnered with, Domingo added.

Connecting RWA and DeFi

Converge, unveiled last month, aims to connect the rapidly growing tokenized real-world assets (RWA) sector with the DeFi space, building on existing ecosystems around Ethena and Securitize and their multi billion dollar worth of assets.

Ethena has quickly become a DeFi powerhouse, spearheading the yield-bearing stablecoin trend with its $5 billion “synthetic dollar” token USDe. Meanwhile, Securitize issues nearly $4 billion in tokenized assets by traditional finance giants like Apollo and Hamilton Lane and BlackRock’s blockchain-based money market fund token BUIDL. The latter is also the key backing asset of Ethena’s $1.4 billion USDtb stablecoin.

“Converge’s ambitious vision of onboarding tens of billions of institutional capital on-chain requires providing users with high performance and elevated security guarantees,” Guy Young, founder of development firm Ethena Labs, said in a statement.

To achieve that lofty goal, the Converge chain’s performance relies on a custom sequencer for an Arbitrum-powered blockchain, while using Celestia as the data availability layer underneath it, according to the tech update shared with CoinDesk. A sequencer is a key piece of blockchain infrastructure that compiles transactions from layer-2 networks and posts them back to the layer-1 network.

Data availability layers, like Celestia, aim to bring down the downloading and storage costs for data-intensive blockchain networks. The combination of Conduit’s G2 sequencer, as well as the use of Arbitrum and Celestia’s tech is supposed “to push the boundaries of what level of throughput is possible on EVM-based networks,” the team wrote.

The network will use Ethena’s USDe and USDtb as gas tokens to pay for transaction costs across the network. Both tokens are designed with a price anchored to $1, allowing easier accounting for transaction costs, the team wrote.

Converge will also support both permissionless and permissioned applications operating side by side. Developers can deploy permissionless DeFi apps freely, while institutional issuers such as Securitize can create permissioned environments for compliant real-world asset products.

In addition, the Converge Validator Network (CVN) is supposed to provide the foundations of the network’s security, by essentially acting as the chain’s security council. The CVN will have the ability to interfere during emergencies like when funds are at risk, perform circuit breakers to pause user-activity if there are serious bugs, as well as review important governance proposals.

In order to participate in the CVN, validators must stake ENA, Ethena’s governance token. According to the team, the CVN will go live shortly after mainnet launches.

“Technical breakthroughs on this initiative will drive asymmetric product outcomes for Converge, and thus growth in USDe, USDtb and other Ethena and Securitize products,” Young said.

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Ethena Agrees With Regulator to Withdraw From German Market

Decentralized finance (DeFi) protocol Ethena has agreed to wind down its operations in Germany.

The decision comes three weeks after BaFin, Germany’s finance regulator, identified “serious deficiencies” in Ethena’s USDe token and said that the company was offering securities in Germany without approval.

“We have agreed with BaFin to wind down all activities of Ethena GMBH and will no longer be pursuing the MiCAR authorization in Germany,” Ethena said in a tweet.

It added that all previous users will be onboarded to Ethena BVI, the protocol’s entity in the British Virgin Islands.

Ethena is the yield-generating protocol with $4.9 billion in total value locked (TVL). The USDe token is dubbed a “synthetic dollar” and is backed by bitcoin (BTC), ether (ETH) and other cryptocurrencies.

Ethena’s ENA token is down by 2.88% in the past 24 hours, underperforming against the wider market which is up 1.17%, according to CoinMarketCap.

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Tokenized Gold Hits Record $1.4B Market Cap as Trading Volumes Soar in March

The market capitalization of tokenized gold climbed to a record $1.4 billion in March with trading volumes soaring to yearly highs, CoinDesk Data’s monthly stablecoin report shows.

The growth in market value and activity happened alongside the physical yellow metal’s rally to fresh all-time highs above $3,000 per ounce. Tether’s gold-backed token (XAUT) and Paxos’ PAXG dominate among the offerings, with market capitalizations of $749 million and $653 million, respectively.

The trading volume with gold tokens surpassed $1.6 billion through the month, the highest level in more than a year, according to the report.

The overall stablecoin market, which includes tokens with prices pegged to fiat currencies and commodities, climbed above $231 billion market cap this month, growing for the 18th consecutive month, the report said.

Tether’s USDT, the largest stablecoin on the market, also increased to a record supply of $144 billion. However, its market share dropped to the lowest level (62.1%) since March 2023 as the stablecoin landscape is getting increasingly competitive. Circle’s USDC, the second-largest stablecoin, grew 7% in a month to near $60 billion.

Decentralized finance protocol Ethena’s recently launched dollar stablecoin USDtb, which uses BlackRock’s tokenized money market fund BUIDL as a reserve asset, quickly gobbled up over $1 billion of assets to become the 8th largest by market cap.

In terms of trading volumes on centralized exchanges, USDT’s dominance slightly declined, but still stood above competition at 75.7% through the month among the top ten stablecoins. Meanwhile, USDC and Hong Kong-based First Digital’s FDUSD saw their trading market cap dominance rise to 13.6% and 10%, respectively.

Regulatory shifts have been reshaping the market of euro-denominated stablecoins, as exchanges moved to comply with the Markets in Crypto-Assets (MiCA) framework. Kraken delisted USDT and other non-compliant stablecoins for European users, following the footsteps of other exchanges such as Coinbase and Crypto.com.

Circle’s EURC stablecoin was a notable beneficiary of the developments, growing nearly 30% to $157 million market cap and claiming a 45% market share of all euro stablecoins.

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German Regulator Identifies ‘Deficiencies’ in Ethena’s USDe Stablecoin

The German financial supervisory authority BaFin said it identified “serious deficiencies” in Ethena’s synthetic USDe stablecoin.

Ethena is the yield-generating protocol. The stablecoin has a market cap of $5.4 billion.

Ethena said on X that it will “continue to evaluate alternative frameworks,” after being notified that the “application under the MiCAR regulatory framework will not be approved.”

In a statement, BaFin said that the deficiencies are related to the “bank’s business organization and violations of MiCAR requirements, such as those regarding asset reserves and compliance with capital requirements.”

“BaFin also has reasonable grounds to suspect that Ethena GmbH is publicly offering securities in Germany in the form of ‘sUSDe’ tokens of Ethena OpCo. Ltd. without the required securities prospectus,” the regulator said.

Ethena’s ENA tokenhad dropped 6.5% in the past 24 hours, extending losses following the announcement, according to CoinMarketCap data.

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BlackRock’s BUIDL Fund Tops $1B with Ethena’s $200M Allocation

Global asset manager BlackRock’s BUIDL token, issued in partnership Securitize and backed by U.S. Treasuries, crossed the $1 billion milestone in assets on Thursday, Securitize said.

Pushing the fund’s size above the threshold was a $200 million allocation this afternoon by crypto protocol Ethena, a Securitize spokesperson told CoinDesk. Ethereum blockchain data by Arkham Intelligence shows an entity minting $200 million worth of BUIDL tokens at Thursday 18:47 UTC.

Crypto tokens backed by U.S. Treasuries are at the forefront of tokenization efforts, as digital asset firms and global financial heavyweights race to put traditional instruments such as bonds, private credit and funds on blockchain rails, aiming to achieve faster settlements and operational efficiencies.

BUIDL serves as a building block for multiple yield-generating offerings, and it’s increasingly used as collateral on trading platforms. It’s a key reserve asset for Ethena’s yield-generating USDtb token, which now has a $540 million supply. USDtb’s value is backed by USDC and USDT stablecoins and some $320 million worth of BUIDL tokens.

“Ethena’s decision to scale USDtb’s investment in BUIDL reflects our deep conviction in the value of tokenized assets and the significant role they will continue to play in modern financial infrastructure,” said Guy Young, founder of Ethena.

Read more: Tokenized Treasuries Hit Record $4.2B Market Cap as Crypto Correction Fuels Growth

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MEXC Ventures Invests $36M in Ethena and USDe as Stablecoin Demand Continues to Surge

MEXC Ventures, the investment arm of crypto exchange MEXC, is investing a total of $36 million into Ethena and its USDe stablecoin, according to a press release.

The firm is making a strategic investment of $16 million in Ethena and bought $20 million in USDe stablecoin to expand the adoption of synthetic dollars in decentralized finance (DeFi) and offer an alternative to fiat-backed stablecoins, the statement said.

The move comes after Ethena, the developer of USDe, raised $100 million last year, which was backed by Franklin Templeton and Fidelity Investments-affiliated F-Prime Capital, among others.

Known as a synthetic stablecoin, USDe is unlike traditional stablecoins like USDT and USDC in that it is not backed 1:1 by fiat assets. Instead, it maintains its peg by collateralizing stablecoins and taking futures positions with large open interest.

USDe’s market cap has risen to nearly $6 billion, while more traditional stablecoins currently have market caps above $50 billion, according to CoinMarketCap data. The total market cap for stablecoins is currently above $200 billion.

MEXC’s backing comes as competition in the stablecoin market intensifies, with projects seeking innovative models to ensure stability and accessibility.

“As demand for investment in bitcoin and other digital assets continues to rise, stablecoins are set to attract even greater investment,” said Tracy Jin, COO of MEXC.

“MEXC sees Ethena as a key player in the development of diverse stablecoins that will drive the crypto industry forward, supporting broader adoption and providing users with more stable and efficient financial solutions.”

Read more: Stablecoin Market Cap Tops $200B as U.S. Sees Industry Helping Maintain Dollar Dominance

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USDe Issuer Ethena Labs Integrates Chaos Labs’ Edge Proof of Reserves Oracles to Strengthen Risk Management

Ethena Labs has integrated Chaos Labs’ data authenticity technology, Edge Proof oracles, to strengthen the risk management framework for its synthetic dollar token USDe.

Edge oracles will independently verify the total dollar value of the USDe’s reserves and the reserve coverage of USDe’s supply and confirm that reserves are governance-approved and delta-neutral. Chaos Labs shared the announcement exclusively with CoinDesk.

USDe, a synthetic stablecoin, maintains a soft peg with the U.S. dollar through an automated delta-hedging strategy that shorts bitcoin and ether perpetual futures to offset changes in the prices of these cryptocurrencies.

The synthetic stablecoin experienced volatility over the weekend, falling to 0.982 against tether and 0.988 against USDC, per Kaiko, amid fears that the protocol has multi-million dollar exposure to Bybit’s ether (ETH) derivatives market. The exchange was hacked late Friday, with a malicious entity draining over $1 billion in ether.

The so-called de-peg, however, was short-lived as Ethena assured investors that all assets backing USDe were held off-exchange and its reserve fund was more than enough to compensate for any losses from the Bybit exploit.

The integration with Chaos Labs adds another layer of credibility to USDe’s reserves, ensuring they stay secure and transparent.

The Edge Proof of Reserves (PoR) oracles will constantly monitor the reserve levels of tokens and check the collateral backing them. This is done by smoothly integrating off-chain data from custodians and centralized exchanges into the on-chain environment, ensuring scalable and robust support for institutional-grade applications.

The integration also provides automated alerts to notify users of any data anomalies or if reserve levels fall below the required thresholds. Verified data is publicly displayed on Ethena’s transparency page and attestor interfaces, keeping stakeholders informed.

“This integration ensures continuous, independent verification of reserves, fostering greater transparency and security for all users. By leveraging real-time, tamper-resistant data, Ethena reinforces its commitment to a robust and reliable synthetic dollar,” the announcement said.

Chaos Labs’ Edge oracle leverages zero-knowledge proofs to ensure security and privacy while providing real-time and transparent data verification, including for reserves held off-chain or across different blockchains.

These oracles have secured over $70 billion in volume, delivering risk management to decentralized finance (DeFi) giants like AAVE, Jupiter, GMX, and Tether.

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USDe Stablecoin Developer Ethena Raises $100M: Bloomberg

Ethena, developer of the synthetic stablecoin USDe, has raised $100 million to finance a similar token targeted at traditional financial (TradFi) institutions, Bloomberg reported on Monday.

The funding round was completed in December, with Franklin Templeton and Fidelity Investments-affiliated F-Prime Capital among the backers, the report added, citing a person familiar with the matter.

Founder Guy Young said in a blog post in January that Ethena has plans to roll out iUSDe, a token tailored to regulated financial institutions.

Known as a synthetic stablecoin, USDe differs from other tokens in that it is not backed 1:1 by fiat assets. Instead, it maintains its peg by collateralizing stablecoins and taking futures positions with large open interest.

USDe’s market cap has jumped to around $6 billion this month, becoming the third largest stablecoin behind Tether’s USDT and Circle’s USDC, which are worth $142 billion and $57 billion respectively.

Some observers see USDe as a potential safe heaven during periods of greater volatility in the wider crypto market. Arthur Hayes, chief investment officer of Maelstrom, has said the digital asset fund has raised its exposure to USDe “to record levels.”

“We will be positioned with copious amounts of dry powder ready to buy the dip on Bitcoin,” Hayes, who is an investor in and an advisor to Ethena, added.

Ethena did not immediately respond to CoinDesk’s request for comment on the $100 million funding round.

Read More: Peter Thiel-Backed Plasma Raises $20M to Develop Bitcoin-Based Network for Stablecoin

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Ethena Rolls Out Stablecoin Backed by BlackRock’s BUIDL Token

Red-hot decentralized finance (DeFi) project Ethena said Monday it is rolling out its new stablecoin that aims to help stabilize the protocol’s flagship USDe token when crypto markets turn bearish.

The USDtb token aims to keep a steady $1 price and holds 90% of its reserves in BUIDL, the tokenized money market fund issued by asset management behemoth BlackRock and tokenization firm Securitize.

“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 in a statement.

Ethena is one of the fastest-growing DeFi platforms this year, attracting nearly $6 billion of user funds since its public launch in early 2024. The protocol’s flagship token USDe, marketed as a “synthetic dollar” with a steady $1 price, generates yield to investors by shorting bitcoin (BTC), ether (ETH) and solana (SOL) perpetual swaps and farming the funding rates. This investment strategy offers lofty yields – currently 27% annualized – when crypto markets are in bull mode, but can quickly turn unprofitable when things turn bearish with persistently negative funding rates.

The new offering will allow Ethena close the underlying derivatives positions behind USDe and divert the backing assets to USDtb during periods of negative funding rates and mitigating risks, the Ethena team explained.

The protocol also aspires to get USDtb accepted as collateral in the future for margin trading on centralized exchanges.

Read more: Tokenized Treasuries: A Game-Changer for Collateral in Crypto Markets

Ethena enlisted Copper, Zodia Custody, Komainu, and Coinbase Institutional as custodians for USDtb, according to a press release. Liquidity providers for the token include Jump, Cumberland, Amber Group, GSR Markets and SCB Limited.

Ethena also applied with the new USDtb stablecoin for Sky’s, formerly MakerDAO, so-called Tokenization Gran Prix program that aims to invest up to $1 billion funds in tokenized real-world asset (RWA) products.

The protocol’s governance token recently garnered the attention of President-elect Donald Trump DeFi project World Liberty Financial, which purchased some $500,000 worth of tokens on Saturday, blockchain data showed. ENA subsequently rallied 25% over the weekend before paring some of the advance on Monday.

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Ethena Partners With Onchain Derivatives Protocol Derive, Secures 5% OF DRV Token Supply for sENA Holders

DeFi protocol Ethena announced Tuesday a new partnership with Derive.xyz, the world's leading on-chain options and structured products platform, featuring a multi-million dollar investment to enhance liquidity and drive growth for both protocols.

Under the partnership, Ethena will integrate Derive's basis trading, options, futures and vaults, leveraging Ethena's USDe stablecoin and staked USDE to boost liquidity and trading volume, the press release shared with CoinDesk said.

Ethena will begin its basis trading on Derive’s perpetual markets, pending approval from the Ethena Risk Council. That's expected to boost volumes and liquidity on Derive, bolstering Derive users' ability to execute large orders at stable prices.

In conjunction with this, the Lyra Foundation, which oversees the Derive protocol, will receive a multi-million dollar grant from the Ethena Foundation, and staked ENA (sENA) holders will be rewarded with 5% of the DRV tokens granted to the Ethena Foundation. The ENA token is a governance token for the Ethena ecosystem.

“Integrating Ethena’s immense liquidity and strong user base with Derive.xyz’s unparalleled derivatives protocol not only unlocks significant opportunities for Derive.xyz users, but also positions it as the premier on-chain derivatives platform," Nick Forster, Founder of Derive.xyz, said.

"Together, we are setting new standards in DeFi, offering innovative solutions that cater to both retail and institutional traders. Get ready for the next generation of groundbreaking on-chain derivatives, liquidity, and financial products," Forster added.

Derive said it's integrating USDe as collateral, allowing users to trade while simultaneously earning a passive yield. Ethena's USDe is a synthetic dollar, which uses a hedged cash-and-carry strategy, also known as the basis trade, and collateralized stablecoin to maintain the $1 price peg.

The on-chain derivatives protocol is also debuting vaults for staked USDe (sUSDe) holders, enabling them to load up on reward by combining Ethena's staking yields with Derive' structured product strategies.

Ethena has over $4 billion in TVL as of writing, with over 300,000 users and integrations with the largest centralized exchanges like Deribit and ByBit.

Meanwhile, with a TVL of $79 million, Derive is the world's largest decentralised protocol, facilitating programmable on-chain options, perpetuals, and structured products. It's native token DRV will go live on Jan. 15, the protocol spokesperson told CoinDesk.

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Ethena Partners with Onchain Derivatives Protocol Derive, Secures 5% OF DRV Token Supply for sENA Holders

DeFi protocol Ethena announced Tuesday a new partnership with Derive.xyz, the world's leading on-chain options and structured products platform, featuring a multi-million dollar investment to enhance liquidity and drive growth for both protocols.

Under the partnership, Ethena will integrate Derive's basis trading, options, futures and vaults, leveraging Ethena's USDe stablecoin and staked USDE to boost liquidity and trading volume, the press release shared with CoinDesk said.

Ethena will begin its basis trading on Derive’s perpetual markets, pending approval from the Ethena Risk Council. That's expected to boost volumes and liquidity on Derive, bolstering Derive users' ability to execute large orders at stable prices.

In conjunction with this, the Lyra Foundation, which oversees the Derive protocol, will receive a multi-million dollar grant from the Ethena Foundation, and staked ENA (sENA) holders will be rewarded with 5% of the DRV tokens granted to the Ethena Foundation. The ENA token is a governance token for the Ethena ecosystem.

“Integrating Ethena’s immense liquidity and strong user base with Derive.xyz’s unparalleled derivatives protocol not only unlocks significant opportunities for Derive.xyz users, but also positions it as the premier on-chain derivatives platform," Nick Forster, Founder of Derive.xyz, said.

"Together, we are setting new standards in DeFi, offering innovative solutions that cater to both retail and institutional traders. Get ready for the next generation of groundbreaking on-chain derivatives, liquidity, and financial products," Forster added.

Derive said it's integrating USDe as collateral, allowing users to trade while simultaneously earning a passive yield. Ethena's USDe is a synthetic dollar, which uses a hedged cash-and-carry strategy, also known as the basis trade, and collateralized stablecoin to maintain the $1 price peg.

The on-chain derivatives protocol is also debuting vaults for staked USDe (sUSDe) holders, enabling them to load up on reward by combining Ethena's staking yields with Derive' structured product strategies.

Ethena has over $4 billion in TVL as of writing, with over 300,000 users and integrations with the largest centralized exchanges like Deribit and ByBit.

Meanwhile, with a TVL of $79 million, Derive is the world's largest decentralised protocol, facilitating programmable on-chain options, perpetuals, and structured products. It's native token DRV will go live on Jan. 15, the protocol spokesperson told CoinDesk.

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Ethena Partners With Onchain Derivatives Protocol Derive, Secures 5% OF DRV Token Supply for sENA Holders

DeFi protocol Ethena announced Tuesday a new partnership with Derive.xyz, the world's leading on-chain options and structured products platform, featuring a multi-million dollar investment to enhance liquidity and drive growth for both protocols.

Under the partnership, Ethena will integrate Derive's basis trading, options, futures and vaults, leveraging Ethena's USDe stablecoin and staked USDE to boost liquidity and trading volume, the press release shared with CoinDesk said.

Ethena will begin its basis trading on Derive’s perpetual markets, pending approval from the Ethena Risk Council. That's expected to boost volumes and liquidity on Derive, bolstering Derive users' ability to execute large orders at stable prices.

In conjunction with this, the Lyra Foundation, which oversees the Derive protocol, will receive a multi-million dollar grant from the Ethena Foundation, and staked ENA (sENA) holders will be rewarded with 5% of the DRV tokens granted to the Ethena Foundation. The ENA token is a governance token for the Ethena ecosystem.

“Integrating Ethena’s immense liquidity and strong user base with Derive.xyz’s unparalleled derivatives protocol not only unlocks significant opportunities for Derive.xyz users, but also positions it as the premier on-chain derivatives platform," Nick Forster, Founder of Derive.xyz, said.

"Together, we are setting new standards in DeFi, offering innovative solutions that cater to both retail and institutional traders. Get ready for the next generation of groundbreaking on-chain derivatives, liquidity, and financial products," Forster added.

Derive said it's integrating USDe as collateral, allowing users to trade while simultaneously earning a passive yield. Ethena's USDe is a synthetic dollar, which uses a hedged cash-and-carry strategy, also known as the basis trade, and collateralized stablecoin to maintain the $1 price peg.

The on-chain derivatives protocol is also debuting vaults for staked USDe (sUSDe) holders, enabling them to load up on reward by combining Ethena's staking yields with Derive' structured product strategies.

Ethena has over $4 billion in TVL as of writing, with over 300,000 users and integrations with the largest centralized exchanges like Deribit and ByBit.

Meanwhile, with a TVL of $79 million, Derive is the world's largest decentralised protocol, facilitating programmable on-chain options, perpetuals, and structured products. It's native token DRV will go live on Jan. 15, the protocol spokesperson told CoinDesk.