Ethena Community Proposes Adding SOL as a Supported Asset for USDe in Stablecoin Protocol

Ethena Community Proposes Adding SOL as a Supported Asset for USDe in Stablecoin Protocol

Ethena Community Proposes Adding SOL as a Supported Asset for USDe in Stablecoin Protocol

Seraphim, Head of the growth department at Ethena Labs, the development company of the stablecoin protocol Ethena, mentioned on Sunday in the community platform X the recent progress made by the protocol. This includes the proposal to use Solana’s native token SOL as collateral for the stablecoin USDe, the launch of a new stablecoin called UStb in collaboration with Securitize and BlackRock, the deployment of over $3 million in cross-chain, and the aim to cover one billion users in CeFi (centralized finance).

A proposal on the Ethena governance forum suggests adding SOL as a supported asset for USDe in a controlled and planned manner, using a similar mechanism as Ethena’s current perpetual contracts for Bitcoin (BTC) and Ethereum (ETH) hedging. The proposal also suggests considering BNSOL (Binance Liquid Staking SOL) and bbSOL (Bybit Liquid Staking SOL) as additional supported assets for USDe.

The proposal points out that there are approximately $2 billion in open contracts for SOL on platforms where Ethena currently executes hedging trades, along with more favorable funding rates for SOL compared to BTC and ETH since 2024. This provides an attractive opportunity for Ethena and USDe to further collaborate with one of the largest ecosystems in the crypto space and potentially increase protocol revenue when market conditions improve.

The proposal author believes that besides the potential increase in protocol revenue through SOL funding rates, this move will also unlock an additional $20 to $30 billion in open interest, allowing Ethena to continue scaling on the current supply of USDe of around $2.5 billion and keep up with any potential growth in market demand.

Related articles: “What is Ethena? A 5-minute tutorial to understand the stablecoin USDe and Ethena” and “Market funding rates turn negative! Stablecoin protocol Ethena faces its biggest challenge since launch”.