tl;dr
Ethena Labs has launched a new stablecoin called 'USDtb,' with nearly 90% of its reserves backed by BlackRock’s BUIDL tokenized fund. The stablecoin, which functions like traditional stablecoins such as USDC or USDT, has generated significant interest and enthusiasm in the crypto community. It is th...
Ethena Labs has launched a new stablecoin called 'USDtb,' with nearly 90% of its reserves backed by BlackRock’s BUIDL tokenized fund. The stablecoin, which functions like traditional stablecoins such as USDC or USDT, has generated significant interest and enthusiasm in the crypto community. It is the first major stablecoin to be backed by BlackRock’s tokenization fund. The stablecoin's launch has also positively impacted Ethena's native token, ENA, which has surged in price. USDtb is positioned to compete in the stablecoin market, offering scalability and stability, and is expected to complement Ethena's previous stablecoin, USDe. The stablecoin's launch reflects Ethena Labs' strategic move to strengthen its position in the competitive stablecoin market, potentially challenging the dominance of existing stablecoins like Tether’s USDT and Circles USDC. Additionally, Ripple's new RLUSD stablecoin is set to launch, indicating a potential shift in market dynamics.
According to the announcement, USDtb is a “wholly independent product” from USDe, the first stablecoin from Ethena. It clarified that this new offering has a different risk profile from USDe due to its substantial backing from BlackRock’s fund. 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 announced its plan to introduce USDtb back in September, and the token finally went live today, December 16. There is notable enthusiasm in the crypto community, as this is the first major stablecoin to be backed by BlackRock’s tokenization fund. Meanwhile, the intrigue surrounding this launch has been reflected in Ethena’s native token. Following the news, ENA surged to its highest price since April, reaching $1.32. Since then, it has based brief corrections and currently trades at $1.20. The token has gained nearly 117% in the past month.
With the anticipation around USDtb since September, ENA has received several investments in the last few months. According to Binance, Donald Trump’s World Liberty Financial (WLFI) recently invested about $500,000 in the token. The venture also invested in other altcoins, such as LINK and AAVE. Also, Ethena Labs claimed that the stablecoin could scale without any practical constraints because of the BUIDL backing, and users will enjoy free and unrestricted transfers.
Although the new stablecoin is a completely different product from USDe, they will have a symbiotic relationship. As USDtb is a more stable asset with substantial reserves, it can be used as a backing asset for USDe. Ethena’s Risk Committee approved a proposal last week to onboard USDtb as a USDe backing asset. During periods of negative funding rates, 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 firm wrote on its announcement.
With this launch, Ethena Labs is looking to strengthen its position in the highly competitive stablecoin market. While Tether’s USDT and Circles USDC have largely dominated the market for several years, these new products can drive wider competitiveness in the market. Ripple’s new RLUSD stablecoin is also set to launch tomorrow. If these assets continue to gain popularity, Tether’s long-standing dominance in the market might shrink throughout 2025.