Starting from April 10, Ethena Labs’ synthetic stablecoin protocol has been connected to the wallets of major exchanges like Binance, Bybit, OKX, and Bitget.
Starting today, users who keep USDe from Ethena in their Web3 wallets for a minimum of 7 days are entitled to a 20% increase in rewards, according to Ethena developers. The incentives, given as “Ethena sats,” can be exchanged for the native ENA token at the conclusion of each campaign. To acquire sats, users must initially transfer USDe stablecoins from Ethana to their exchange wallets, link with the Ethana decentralized finance (DeFi) platform, and stake their assets. The DeFi protocol currently holds a total value of $2.274 billion, producing an annual income of $178 million.
The protocol’s ecosystem rewards have attracted considerable attention and usage. As told by blockchain analytics firm Lookonchain, since the start of Ethena Staking Season 2, the ten top wallets have withdrawn a total of 37.5 million ENA ($51 million) and staked them. On March 8, less than one month after the launch of its USDe stablecoin, Ethena became the highest-earning decentralized application in crypto when it offered a 67% annual percentage yield (APY) on USDe. The protocol currently has an APY of 24% on its stablecoins. However, the yield is not without risks as it relies on trading income of complex Ethereum derivatives to payout promised returns.
In response to worries about its large returns, Guy Young, the founder of Ethena Labs, assured CryptoMoon during an interview on February 22 that comparisons to the collapsed Terra Luna stablecoin USTC were hasty and unfounded. Young emphasized that Anchor’s yields at Ethena Labs were natural and self-sustaining instead of being artificially inflated, as was the case with USTC where yields originated from venture capitalists pouring money into Anchor and subsequently distributing returns without a genuine source.
In the meantime, Ethena’s returns, which can be checked publicly, come from various sources including rewards from Ethereum network inflation, fees obtained by stakers for executing transactions, maximum fees earned by stakers, and income generated by Ethena Labs through trading. To clarify, Ethena creates short positions using collateral assets given to it for minting USDe. The difference between the values of these two positions is then distributed as returns to USDE holders.
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2024-04-10 21:30