- Ethena’s plan to distribute money to tokenized real-world assets for yield is in line with similar moves made by Ethereum layer-2 Arbitrum’s development team and cryptocurrency lender MakerDAO.
- Ethena disclosed intentions to invest a portion of its $45 million excess reserve and $235 million USDT stablecoin collateral in yield-producing real-world asset (RWA) offers.
- Steakhouse Financial applied with a lending vault on Morpho Blue, while BlackRock’s BUIDL fund made a pitch for a $34 million allocation.
BlackRock’s BUIDL fund is one of the first applicants to enter the $3.4 billion yield-generating synthetic dollar token USDe’s tokenized real-world asset (RWA) investment pool planned by Ethena, the protocol underpinning it.
The protocol announced plans in a governance post dated July 16 to allocate to RWA products for yield-generating purposes a portion of its $235 million USDT holdings, around 7% of collateral assets, and its $45 million excess buffer known as the Reserve Fund. By purchasing spot bitcoin {{BTC}} and ether {{ETH}} and concurrently selling, or shorting, perpetual swaps of the assets on cryptocurrency exchanges, Ethena’s token generates yield for investors by collecting funding rate.
According to a Monday post by Jonathan Espinosa from tokenization platform Securitize, BUIDL’s distribution partner, Ethena’s $45 million Reserve Fund is being considered for an allocation of $34 million towards BlackRock’s BUIDL money market fund, which is represented by an Ethereum-based token.
Additionally, Steakhouse Financial submitted an application on Monday for the distribution of Reserve Funds using a USDC lending vault on the DeFi platform Morpho Blue. The USDC lending vault is overcollateralized with wrapped staked ether (wstETH), wrapped bitcoin (wBTC), and Backed’s tokenized Treasury Bills product (bIB01).
The creator of Mountain Protocol, which issues the yield-bearing stablecoin USDM, expressed interest in applying as well. Michael Carrica responded to the governance post last week, stating that the protocol will be submitting a petition shortly.
Guy Young, the founder of Ethena Labs, the protocol’s development business, stated in an email that all potential applicants would have to publish their proposals in public on the governance forum.
The most recent instance of tokenized RWAs becoming more popular in the context of crypto-native, decentralized finance (DeFi) is Ethena’s open competition. Most recently, Ethereum layer-2 Arbitrum ecosystem development organization ArbitrumDAO concluded a similar competition to distribute the equivalent of 35 million ARB tokens in tokenized offerings, while DeFi lender MakerDAO announced plans to invest $1 billion of the DAI stablecoin’s backing assets in tokenized Treasury products.
Disclaimer : This article was created for informational purposes only and should not be taken as investment advice. An asset’s past performance does not predict its future returns. Before making an investment, please conduct your own research, as digital assets like cryptocurrencies are highly risky and volatile financial instruments.
