Ethena Launches Stablecoin Backed by BUIDL Token

This stablecoin is backed by BlackRock’s BUIDL token , a money market fund tokenized with the help of Securitize.

The big idea? To help Ethena stay steady when crypto markets get shaky.

Keeping Things Stable

The new USDtb token aims to keep its price pegged at $1, no matter what happens in the crypto market. How? By holding 90% of its reserves in BUIDL, a token tied to real-world assets managed by BlackRock, one of the largest asset managers in the world.

Guy Young, Ethena’s founder, said, “We saw an opportunity to offer a new stablecoin with a different level of risk while keeping users within our ecosystem.” In other words, this token gives investors another tool in their toolbox, especially when markets take a downturn.

Congratulations to @Ethena_Labs on the launch of USDtb! 🎉

We’re proud to see @BlackRock ’s BUIDL Fund, tokenized by Securitize, serving as the cornerstone of USDtb’s reserve assets. This milestone underscores the growing potential of tokenization to bridge traditional finance… https://t.co/acAwe0XCxt

— Securitize (@Securitize) December 16, 2024

Why Is This a Big Deal?

Ethena’s current flagship token, USDe , works like a “synthetic dollar.” It generates profits by shorting perpetual swaps for Bitcoin (BTC), Ethereum (ETH), and Solana (SOL) while farming funding rates. That’s a fancy way of saying USDe earns money when the market is hot. But when markets turn bearish (falling prices), this strategy can cause money to be lost fast.

Ethena has a backup plan with USDtb. When funding rates go negative—or the market looks gloomy—Ethena can close risky positions and move assets into USDtb. This new system could help Ethena ride out storms without losing its footing.

USDtb functions like a traditional stablecoin such as USDC or USDT, utilizing cash and cash-equivalent reserve assets to back each token

Blackrock’s BUIDL represents the vast majority of the USDtb backing, currently the highest BUIDL allocation of any stablecoin in the market…

— Ethena Labs (@ethena_labs) December 16, 2024

Ethena also has big plans for USDtb. The protocol wants USDtb to be used as collateral for trading on centralized exchanges . Think of it like this: If you want to borrow funds or trade on a platform, you’d be able to use USDtb as a secure deposit. On top of that, Ethena has applied for a spot in Sky’s $1 billion tokenized asset investment plan, which could bring even more value to USDtb.

Ethena’s Rapid Rise

Ethena has been turning heads this year. Since its launch in early 2024, the platform has attracted nearly $6 billion in user funds. Its main token, USDe, has been a hit with investors looking for high yields—currently around 27% annualized. But the risks are clear when markets flip.

You must not be afraid to dream a little bigger, darling pic.twitter.com/CmLUUuQqWx

— Ethena Labs (@ethena_labs) December 13, 2024

The introduction of USDtb helps Ethena prepare for rough waters while offering users a safer option. Over the weekend, the protocol’s governance token ENA got an extra boost after Donald Trump-affiliated World Liberty Financial invested in it.

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