Bittime - Ethena Labs, the team behind the synthetic stablecoin USDe pegged to the US dollar, has added Bitcoin (BTC) as its backing asset.
This move is expected to significantly increase USDe's scalability from the current supply value of $2 billion.
Improving USDe Scalability with Bitcoin
Ethena (ENA) explained in an April 4 post on the fold.
USDe: Launch and Development
USDe itself was launched on the Ethereum (ETH) network on February 19. At that time, Ethena offered a high Annual Percentage Yield (APY), namely 27.6% for staked USDe .
This offer sparked concern among the crypto community. USDe's APY peaked at 113% on March 5, but has now fallen to 7.15%.
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Advantages of Bitcoin for USDe
Ethena (ENA) argues that Bitcoin will provide better liquidity and make USDe a more “secure” and “robust” product for USDe token holders.
Ethena (ENA) uses a delta hedging strategy in the derivatives market to defend the USDe peg against the US dollar.
For example, Ethena (ENA) may have a short (sell) position in Ether or an Ether-based derivative.
This position will be profitable when the price of Ether falls. Thus, Ethena (ENA) can overcome the potential decline in value of USDe's backing assets to a certain degree.
Composition of USDe Supporting Assets
Before including Bitcoin, USDe is supported by Ether (ETH), Tether (USDT), and Ether-based staking tokens with proportions of 45%, 38%, and 17% respectively.
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Most of USDe's backing assets come from crypto exchanges Binance (59%), ByBit (15%), and OKEx (20%). The remaining 6% comes from Deribit, Bitget, and BitMEX.
Staking Yield Bitcoin vs Ether
Ethena (ENA) admits that Bitcoin (BTC) does not have a built-in staking yield like staked Ether. However, they argue that a 3-4% staking yield is “less significant” during a bull market where funding rates can exceed 30%.
Differentiating USDe from Other Stablecoins
Ethena (ENA) seeks to differentiate USDe from other stablecoins by reducing or even eliminating dependence on the traditional banking system.
USDe Market Capitalization Ranking
According to CoinGecko, USDe currently ranks fifth in terms of market capitalization among US dollar-denominated products. USDe's market cap of $2 billion is behind only USDT, USD Coin (USDC), Dai (DAI), and First Digital USD (FDUSD).
How to Buy Crypto on Bittime
You can buy and sell crypto assets in an easy and safe way via Bittime . Bittime is one of the best crypto applications in Indonesia which is officially registered with Bappebti.
To be able to buy crypto assets on Bittime , make sure you have registered and completed identity verification. Apart from that, also make sure that you have sufficient balance by depositing some funds into your wallet. For your information, the minimum purchase of assets on Bittime is IDR 10,000. After that, you can purchase crypto assets in the application.
Learn Complete Guide How to Buy Crypto on Bittime .
Monitor price chart movements of Bitcoin (BTC) , Ethereum (ETH) , Solana (SOL) and other cryptos to find out today's crypto market trends in real-time on Bittime.
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DISCLAIMER: This article is informational in nature and is not an offer or invitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.
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