Following the announcement, Ethena labs token, ENA, surged by over 16%, with increased trading activity and open interest in futures.
Ethena Labs announced on Thursday that it will create a stablecoin named UStb, with collateralization from BlackRock and Securitize. In addition to USDe, this will allow for a different fiat stablecoin product.
Ethena Labs Announces UStb Stablecoin
The United States Treasury will allocate its reserves to the USD Institutional Digital Liquidity Fund (BUIDL), which Securitize tokenizes and BlackRock manages. On September 26, Ethena Labs announced the launch of UStb, its newest product offering, in a post on X.
In addition, the company stated that it will maintain its status as an independent product that is distinct from USDe. It will provide users and exchange partners with a new product that has a risk profile that is distinct from that of USDe.
It is possible, however, that USDe would profit from the incorporation of UStb during times when funding circumstances are weak. USDe backing composition has the ability to dynamically switch between basis positions and liquid stable products.
On multiple occasions, the cryptocurrency community has expressed concerns to USDe about how the protocol reacts to settings with negative funding rates. Despite the bearish conditions that have prevailed over the past six months, Ethena’s SUSDe has not seen a single week of negative financing. This is an important fact.
Ethena is able to conclude hedging bets on USDe and re-allocate the backing assets to UStb in the event that it is necessary to do so in order to further limit risks associated with negative funding rates.
ENA Price Shoots Over 16%
As a result of the news on the debut of the UStb stablecoin, the price of ENA has increased by more than sixteen percent, and it is presently trading at $0.3659. The low for the past 24 hours is $0.3071, while the high for the same period is $0.3728.
In addition, the volume of trading has increased over the past twenty-four hours. Traders on the derivatives market purchased a significant amount of the cryptocurrency. Coinglass data shows that open interest in ENA futures has increased by more than thirty percent in the past four hours.
Exchanges such as Binance, Bybit, and Coinbase witnessed significant buying activity, bringing the total amount of open interest in ENA futures to $165.76 million.
Not too long ago, Ethena Labs suspended its website due to a domain hack, advising users to disconnect their wallets and refrain from making any transactions until further announcements.
Ethena Labs’ domain breach led to the website’s downtime, without compromising the core protocol or user funds.
