Ethena’s USDtb stablecoin reaches $65M TVL on day one

Ethena Labs has launched its USDtb stablecoin, backed by BlackRock’s USD Institutional Digital Liquidity Fund, amassing $65.4 million in total value locked (TVL) within the first 24 hours.

Announced on Dec. 16, USDtb is designed to function similarly to stablecoins like Tether (CRYPTO:USDT) and USD Coin (CRYPTO:USDC), maintaining a 1:1 ratio with cash or cash equivalents.

Ethena Labs stated the stablecoin would help users of its primary product, USDe, “weather difficult market conditions” by reallocating assets to USDtb when necessary.

“Ethena will be able to close the hedging positions underlying USDe and re-allocate its backing assets to USDtb to further ameliorate related risks,” the team explained in their announcement.

The stablecoin is backed 90% by BlackRock’s fund, in collaboration with blockchain tokenisation firm Securitise.

The remaining 10% of reserves are made up of stablecoins like USDC, providing additional liquidity when US Treasury bill markets are closed, such as on weekends.

Ethena’s head of growth, Seraphim Czecker, emphasised the project’s scalability, claiming USDtb has the potential to reach $100 billion by creating a yield floor around the Treasury bill rate during bearish market conditions.

José Maria Macedo, co-founder of Delphi Labs, predicted USDtb could become “the largest tokenised treasury product within one month of launch.”

The USDtb smart contracts underwent three audits from firms Pashov, Quantstamp, and Cyfrin in October, with no significant issues identified.

The project received approval from Ethena’s Risk Committee in late September, with final details confirmed earlier this month.

USDtb’s launch comes amid increasing competition in the stablecoin market. Ethena’s USDe stablecoin recently surpassed Dai to become the third-largest stablecoin, though it remains far behind USDT and USDC.

According to DefiLlama data, the stablecoin market now exceeds $200 billion in value, with analysts predicting it could reach $400 billion by 2025 if US legislation passes.

At the time of reporting, the price of Ethena (ENA) was $1.17.