Highlights:
- Deribit plans to integrate Ethena’s USDe as a reward for margin collateral, enhancing the trading capabilities for the users.
- Traders can hold USDe for rewards and use it as collateral for derivatives margins.
- After the announcement the price of ENA token increased, reflecting increased market interest.
Deribit, a prominent player in the arena of cryptocurrency derivatives, plans to integrate Ethena’s USDe as a margin collateral. The integration has been set for early January 2025 but will depend on the regulatory conditions. As per the announcement, traders will be rewarded for holding USDe. Moreover, they can use it as derivative margin collateral in cross-collateral pools.
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Deribit joins Bybit, Bitget and Gate in integrating USDe as margin collateral
Users are able to use USDe as a part of single or multi-exchange derivatives strategies all while enjoying rewards
— Ethena Labs (@ethena_labs) November 22, 2024
Ethena’s USDe is a decentralized synthetic dollar. It seeks to equate its value to that of the US dollar without direct backing from physical dollars. Instead, USDe is backed by delta-hedging derivatives positions on perpetual and futures markets. This adds to its fully decentralized nature allowing USDe to offer a unique alternative to traditional stablecoins.
Unlocking New Structured Product Use Cases
Guy Young, founder of Ethena Labs, said the integration unlocks new structured product use cases. These were not possible with traditional stablecoin collateral on centralized exchanges. According to him, “With 85% market share, this will be a key venue for USDe use cases.” The integration can thus have a major impact on the derivatives market.
This integration of USDe within the cross collateral pool at @DeribitExchange unlocks completely new structured product use cases not previously possible on CEXs with vanilla stablecoin collateral
With more than >85% of market share within the options space I expect this will… https://t.co/4XNdCJANcv
— G | Ethena (@leptokurtic_) November 22, 2024
Traders can utilize USDe either as part of a single or multi-exchange strategy. Holding the synthetic dollar earns them rewards. In addition, the ability to earn rewards and use USDe as collateral enhances the trading ecosystem. This may attract institutional investors and individual traders in search of innovative financial instruments.
Growing Adoption of USDe and ENA Price Surge
Deribit is not the only exchange integrating USDe. Among other exchanges, bitget, bybit, and gate have included USDe as margin collateral. This growing acceptance shows rising interest in Ethena’s products. USDe is gaining popularity with investors and traders.
After the news, Ethena’s governance token, ENA, jumped by 10% on the daily chart reaching an intraday high of $0.63. Over the past 30 days, ENA has risen roughly 70%. Trading volume increased by 18% in the last 24 hours. This indicates heightened market interest among traders and Ethena’s projects.
Furthermore, Dune Analytics data indicates that Ethena’s USDe supply increased by 47.45% to a record level of USD 3.75 billion in the past month. On the 21st of November, USDe saw an inflow of $119 million, marking the highest inflow since the mid-April. At the same time, the sUSDe staking rate rose to 68.4%, the highest level reached since February.
Ethena USDe supply has increased by about 47.45% in the past month to $3.75 billion, a record high. On November 21, about $119 million flowed into USDe, the highest single-day inflow since mid-April this year. At the same time, the sUSDe stake rate reached 68.4%, the highest…
— Wu Blockchain (@WuBlockchain) November 22, 2024
In November, Ethena approved Wintermute’s fee-sharing proposal for ENA token holders. This was designed so that the growth in revenues of the protocol would also be in the interests of users holding staked ENA (sENA). The proposal suggests activating the fee switch by November 30 which will allow those who stake governance tokens to benefit.
Ethena has seen a notable increase in USDe stablecoin’s revenue generation. However, sENA holders have not benefited directly. Ethena wants to close the link between ENA holders and the protocol’s performance by allocating some of the revenues to enhance the value and utility of staked tokens.
Ethena recently proposed adding Solana and its liquid-staked variants as reserve assets. The company integrated USDe into Aave, allowing billions in borrowing and offering yields of up to 30%. In September, Ethena collaborated with BlackRock and digital securities platform Securitize on a new stablecoin project called UStb (USTB). These efforts demonstrate Ethena’s commitment to its ecosystem expansion.
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