Ethena Labs, the synthetic stablecoin protocol, has announced integration with centralised exchange wallets from major platforms such as Binance, Bybit, OKX, and Bitget, effective as of April 10.
According to Ethena developers, users who lock USDe stablecoins for a minimum of 7 days through exchange Web3 wallets will receive a 20% reward boost starting immediately. These incentives can be converted to the platform’s native ENA token at the end of each campaign. To qualify for sats, users need to deposit Ethena USDe stablecoins into their exchange wallets, connect to the Ethena decentralised finance (DeFi) protocol, and stake their holdings. Currently, the protocol boasts a total value locked of $2.274 billion, generating an annualised revenue of $178 million.
The ecosystem rewards offered by the protocol have garnered significant attention and usage. According to blockchain analytics firm Lookonchain, during the Ethena Staking Season 2, the top 10 wallets withdrew a collective total of 37.5 million ENA ($51 million) and staked them.
On March 8, shortly after launching its USDe stablecoin, Ethena became the highest-earning decentralised application in the crypto space by offering a 67% annual percentage yield (APY) on USDe. Presently, the protocol maintains an APY of 24% on its stablecoins. However, it’s important to note that these yields entail risks, as they depend on trading income from complex Ethereum derivatives to fulfil promised returns.
Addressing concerns regarding its high yield, Guy Young, the founder of Ethena Labs, dismissed comparisons to the failed Terra stablecoin, TerraUSD (UST), labelling them as “knee-jerk reactions.” Young emphasised that Ethena’s yields are organic and sustainable, unlike the fabricated returns of Anchor’s yield, which he asserted came from venture capital investments rather than actual trading income.
Ethena’s yields are derived from various sources, including Ethereum consensus layer inflation rewards, execution fees paid to Ether stakers, maximal extractable value fee captures obtained by Ether stakers, and trading income from Ethena Labs. Specifically, the firm initiates short derivative positions when receiving long-position collateral assets for minting USDe. The resulting spread between these positions is distributed to USDe holders as yield.