Ethena Labs to Launch New Stablecoin Backed by BlackRock

Ethena Labs announced that is it working on the development of a new stablecoin backed by $9 trillion asset manager BlackRock. The Ethena stablecoin developers said Thursday that BlackRock has established a tokenized fund for the new UStb stablecoin. Digital securities platform Securitize is also a partner of the new project.

The stablecoin will be backed by BlackRock’s tokenized BlackRock USD Institutional Digital Liquidity Fund (BUIDL), which offers a stable value of $1 per token. UStb will be a separate fiat stablecoin product alongside Ethena’s USDe (USDE), a synthetic dollar stablecoin the developer launched in February.

“This will exist as an isolated product separate from USDe offering users and exchange partners a new product with a differentiated risk profile to USDe,” Ethena Labs said Thursday. Additionally, the developers said that the community has been “increasingly concerned” about the USDe response to the negative funding rate.

“Despite bearish conditions over the last six months, Ethena’s USDe has not endured a single week of negative funding,” Ethena Labs countered.

Also Read: Robinhood and Revolut Consider Launching Their Own Stablecoins

Ethena Expanda Current Stablecoin Offerings to UStb

Ethena’s USDe has established itself as a major emerging stablecoin in the last year. Its market value surged past $2 billion in April, according to CoinGecko data

Furthermore, Ethena Labs’ new UStb stablecoin could help resolve the lingering issues with USDe. “Nevertheless, if required USDe backing composition can dynamically adjust between basis positions and liquid stable products in different interest rate environments and USDe can benefit from incorporating UStb during periods of weak funding conditions,” their announcement post added.

Ethena Labs offering both USDe and UStb stablecoins allows the firm to expand into new collateral offerings on centralized crypto exchanges. “It can offer exchange partners the choice of two distinct products for margin collateral,” the post added. More information on the new stablecoin, including its launch date, will be announced later by Ethena Labs.

Also Read: US Dollar Tanks, Gold Rallies: AI Predicts Which Asset To Invest In?

“This collaboration represents a key milestone in the evolution of tokenized finance, bringing together leading innovations in stablecoins and real-world asset tokenization,” Securitize confirmed in a subsequent X post. BlackRock has yet to comment on the collaboration project.