Updated: April 4, 2024, 4:15 PM EDT
Ethena Labs has added Bitcoin as a supported asset for the USDe synthetic dollar as traders embrace the resurgence of the world’s oldest digital asset.
Decentralized Finance (DeFi) Protocol said In a series of posts about The move comes as the Bitcoin derivatives market outperforms the market for its Ether-based equivalents.
“As Ethena approaches $10 billion in scale, this provides stronger support and ultimately a more secure product for users,” the protocol said Thursday. He added that the current supply of USDe is approximately $2 billion.
Ethena also pointed to Bitcoin’s superior liquidity and duration profile for delta hedging compared to liquid staking tokens as factors in its decision to add Bitcoin as a supported asset.
Until now, USDe has only been supported by Ether liquid staking tokens, according to Ethena Labs’ website. However, token holders are showing greater interest in Bitcoin trading.
Ethena said Bitcoin open interest has grown 150% in the past year, reaching $25 billion, more than doubling USDe’s ability to scale. Meanwhile, according to data cited by Protocol, Ethereum’s open interest increased 100% to only $10 billion during the same period.
Bitcoin’s relatively strong demand comes amid a spectacular rise in the virtual token’s speculative value. As of this writing, Bitcoin is trading at $68,384, up 4% in the last 24 hours, according to price data from The Block.
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About the author
Elizabeth Napolitano is a data reporter covering business and technology news with a focus on cryptocurrency. Before she joined The Block, Elizabeth reported on BigTech, AI, crypto, and video games for CBS Moneywatch. As a CoinDesk reporter, she covered DeFi, NFTs, and US courts. She received a master’s degree in journalism from CUNY. X: Follow her at @LizKNapolitano.