Ethena Raises $100M to Launch iUSDe Stablecoin Targeting Traditional Financial Institutions

USDe stablecoin issuer, Ethena has raised $100 million to fund the launch of iUSDe. The funding round, which closed in December, saw participation

Ethena, the developer behind the synthetic stablecoin USDe, has raised $100 million to support the launch of a new token aimed at traditional financial institutions (TradFi).

The new token, called iUSDe, will be designed to comply with regulatory requirements and will be used by TradFi institutions to gain exposure to digital assets. Ethena plans to launch iUSDe in the first quarter of 2025.

The funding round, which closed in December, saw participation from major investors including Franklin Templeton and F-Prime Capital, the venture capital arm of Fidelity Investments.

The funds raised will be used for the continued development of Ethena’s blockchain and the introduction of iUSDe. The new token will feature a “simple wrapper contract” that places transfer restrictions on it, making it suitable for use by regulated financial entities.

Ethena is also planning to secure distribution partners within TradFi for the new token. The project aims to roll out iUSDe in the first quarter of 2025.

According to the report, the ENA tokens from the private sale were sold at an average price of $0.40. The token briefly surged to a high of $1.30 in mid-December. However, a subsequent decline saw the tokens lose significant value.

The new development comes as Ethena continues to push forward with its blockchain goals and the market keeps an eye on how its offerings impact TradFi institutions.

Meanwhile, USDe has seen a recent surge in popularity, with its market cap reaching approximately $6 billion, making it the third-largest stablecoin. It trails behind Tether’s USDT and Circle’s USDC, which have market caps of $142 billion and $57 billion respectively.

The stablecoin is unique in that it is synthetic, meaning it isn’t backed 1:1 by fiat assets. Instead, USDe uses a combination of stablecoins and futures positions to maintain its peg.

Earlier this month, Ethena made headlines with its synthetic dollar, which attracted the attention of investors and advisors like Arthur Hayes of Maelstrom.

Hayes’ fund notably increased its exposure to USDe, viewing it as a potential safe haven during periods of market volatility. However, Ethena is now shifting its focus to developing a version of USDe that is specifically designed for the TradFi sector.

In related news, Ethena has also entered into a strategic partnership with World Liberty Financial (WFLI), a decentralized finance project backed by former U.S. President Donald Trump.

The collaboration will see the integration of sUSDe, a staked version of USDe, with WFLI’s Aave instance. This will allow users to earn rewards in both sUSDe and WFLI’s native token.

Ethena’s vision to integrate with traditional financial markets marks a significant step in bridging the gap between decentralized finance and established financial systems.

The company is expanding its offerings and building a robust infrastructure that meets regulatory standards.