Athena launches BlackRock-backed UStb stablecoins to complement USDe

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Athena Labs, the startup behind the synthetic dollar USDe, has announced a new stablecoin called UStb, which will be fully backed by BlackRock’s on-chain BUIDL fund. The move expands Athena’s stablecoin offerings and aims to provide additional stability options for users and exchange partners.

https://x.com/ethena_labs/status/1839259051030630757

UStb will function similarly to traditional stablecoins, with its reserves invested in BlackRock’s USD Institutional Digital Liquidity Fund (BUIDL). The BUIDL fund itself holds US dollars, US Treasury bills and repurchase agreements, providing stable support for the new stablecoin.

UStb as a complement to USDe

According to Athena, UStb will exist as an independent product with a different risk profile than USDe. While USDe is a synthetic stablecoin that maintains its $1 value through cash-and-carry arbitrage, UStb aims to provide a more traditional stablecoin structure backed by real-world assets.

The company said UStb can support USDe in difficult market conditions. Athena’s governance structure allows reallocation of underlying assets from USDe to UStb when needed, potentially mitigating the risks associated with negative funding rates.

“UStb can also help the USD improve its difficult market conditions,” Athena Labs said in a press release. “During periods of negative funding, the company may close the underlying USDe hedge positions and reallocate the reserve assets to UStb.”

Trade integration and market impact

Athena plans to list UStb on centralized exchanges like Bybit and Bitget, where USDe is already used as collateral in margin. The addition of UStb will give exchange partners the choice between two distinct margin collateral products, potentially broadening the adoption of Athena’s stablecoin solutions.

Following the announcement, Athena Labs’ governance token ENA saw a significant price increase. In the last 24 hours, the price of ENA has risen by about 14%, rising from $0.307 to $0.378. Trading volume also saw a notable increase, reaching approximately $196.1 million.

However, the market cap of USDe, Athena’s flagship product, fell slightly by $13 million to $2.54 billion on the day of the announcement. This drop comes after the USDe previously surpassed $3 billion in market capitalization in June.

The introduction of UStb represents Athena’s continued efforts to innovate in the decentralized finance (DeFi) space. The company aims to transform Ethereum into a native crypto-ecosystem of profitable stablecoins that operate independently of the traditional banking system.

Ethena’s approach involves leveraging delta-neutral strategies, on-chain custody and derivatives to manage volatility and improve scalability and stability. The addition of UStb to its product lineup demonstrates the company’s commitment to providing diverse stablecoin options for users and exchange partners in various market conditions.

Earlier this month, Athena suffered a frontal attack, although its team confirmed that no funds were harmed or stolen, with the damage limited to its user interface.

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