Ethena’s USDe Bitcoin collateral exceeds $500 million in a week

Bitcoin collateral for Ethena’s USDe synthetic dollar has exceeded $500 million less than a week after its introduction.

The platform’s website data showed approximately $537 million in Bitcoin reserves across various exchanges such as Binance, OKX, and Deribit. The amount represents roughly 26% of its total asset reserve.

The other reserve assets include $714 million in Ethereum, $353 million in liquid-staked Ethereum, and $365 million in Tether’s USDT.

Seraphim Czecker, Ethena’s head of growth, said the substantial Bitcoin reserve was evidence that the platform is ready for the impending halving event. The halving is expected on roughly April 20 and will reduce Bitcoin’s block reward by 50% to 3.125 BTC.

Last week, Ethena onboarded BTC as a backing asset for USDe as part of efforts to create a safer product for its users. However, several market experts warned that the plan could pose a contagion risk for the broader crypto industry.

USDe adoption continues

As the platform’s Bitcoin collateral grows, USDe adoption is also witnessing an astronomic rise.

Data from CryptoSlate shows that USDe’s market capitalization has soared to $2.14 billion, with its trading volume during the past day at $364 million.

Its adoption from major DeFi projects like MakerDAO and Frax Finance has facilitated these high numbers.

Earlier today, Ethena Labs revealed that Frax Finance approved a $250 million liquidity pool to facilitate automated market operations (AMO) for minting new FRAX tokens.

According to Ethena Labs:

“As of yesterday FRAX has begun adding USDe POL which will create one of the deepest pools of dollar liquidity onchain, and enable FRAX to diversify their source of backing yield.”

Besides that, lending protocol Morpho Labs stated that MakerDAO, the issuer of the DAI stablecoin, allocated an additional $100 million in DAI tokens to its USDe/DAI and sUSDe/DAI markets on Morpho Blue.

It added:

“This follows Maker’s successful proposal to increase Spark’s MetaMorpho Vault DDM Maximum Debt Ceiling from $100 million to $1 billion DAI. The deployment of new DAI debt will happen progressively based on Block Analitica’s risk assessment, starting with the additional $100 million allocated today.”

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