Ethena Labs Approved for $250M USDeFRAX Pool on Curve

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Ethena Labs, a company specializing in creating synthetic dollars, received permission from Frax Finance to set up a USDeFRAX pool with a limit of $250 million on the Curve exchange for their defi stablecoin. This move aims to expand the earning opportunities for FRAX stablecoins.

Thrilled to announce my endorsement of FRAX’s unique plan for singularity development. This blueprint involves setting aside funds for a USDeFRAX Pool through Curve Automated Market Making, with a maximum limit of $250 million in USD.

— Ethena Labs (@ethena_labs) April 8, 2024

Although USDe shares some resemblance with Terraform’s UST in terms of their mechanisms, USDe carries risks based on Fantom’s Andre Cronje, particularly concerning the collateral that supports its link to the US dollar. This design is analogous to UST’s, which has resulted in challenges for Terra’s ecosystem.

USDt (US Dollar Tether) added Bitcoin as a backup to maintain its value parity, mirroring apprehensions raised by CryptoQuant’s Ki Young Ju and Cronje regarding potential crypto market spillover effects. UST (Universal Stablecoin) and Terraform experienced comparable predicaments.

USD Coin (USDC) has reached a market value of over $2 billion just months after its launch in February. This milestone has attracted a significant number of users to the platform, even amid early security concerns. Shortly following its debut on the Ethereum mainnet, Ethena Labs successfully resolved a security vulnerability worth approximately $290,000.

An airdrop of 750 million ENA governance tokens was given out by the protocol to early backers and active community members, indicating deeper engagement and expansion within the stablecoin sector.

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2024-04-09 08:04