Ethena Labs Add Bitcoin As A Guarantee To Strengthen USDE Stablecoin

Ethena Labs, added Bitcoin for collateral. (Photo; Doc. Ethena Labs)

JAKARTA Ethena Labs, a USDe stablecoin developer pegged against the US dollar, has just announced its strategic steps to increase token supplies. Ethena Labs added Bitcoin (BTC) as collateral for USDE, paving the way for significant expansion beyond current supply of $2 billion (approximately IDR 29 trillion).

The move was driven by the rapid growth of open interest in Bitcoin, which jumped from $10 billion (approximately IDR 147 trillion) to $25 million (approximately IDR 368 billion) on major crypto exchanges in the past year. Ethena estimates that USDe has the potential to grow 2.5 times by taking advantage of this trend.

Ethena believes that Bitcoin's inclusion as collateral will provide a number of benefits, including:

Previously, USDe was only guaranteed by Ethereum (ETH), Tether (USDT), and Ether-based liquidity staking tokens. Ethena gets most of its collateral from centralized exchanges such as Binance, ByBit, and OKX.

While Bitcoin does not offer staking results like ETH, Ethena notes that the 3-4% staking gain is less significant in the bullish market, where the funding rate can reach more than 30%.

Currently, USDE ranks fifth in market capitalization among stablecoins, under USDT, USD Coin (USDC), Dai (DAI), and First Digital USD (FDUSD). However, some parties in the crypto community, such as the famous DeFi developer Andre Kronje, still doubt the sustainability of Ethena Labs models.

The addition of Bitcoin as collateral by Ethena Labs is a bold step to strengthen USDe's stablecoins and open up significant expansion opportunities. Despite some doubts, Ethena believes that this strategy will increase USDe's liquidity, security and stability, making it a more attractive choice for users.