Ethena, a project I’ve discussed on multiple occasions, is making significant strides in the cryptocurrency sphere by developing a delta-neutral stablecoin named USDe on the Ethereum blockchain. The project boasts an impressive roster of investors including major names like Bybit, OKX, Gemini, BitMEX, Deribit, Huobi, notable figures such as Arthur Hayes, Cobie, and Synthetix’s chief engineer 0xAfif. Recently, it also garnered support from Binance, underscoring the widespread industry backing for this initiative.
The platform, which initially granted access through a whitelist (WL) system, has now opened its doors to the public, marking a significant milestone in its development. In line with the crypto tradition of engaging community participation, Ethena introduces “Shards” – points that users can farm, with the promise of platform token rewards set for April 2024.
Users have three primary ways to earn Shards:
- Adding Liquidity and Locking LP Tokens: This method offers an attractive rate of 20x shards per day of lock, making it the most lucrative option for participants.
- Purchasing and Holding USDe: Users can earn 5x shards per day of hold, providing a simpler, less involved way to participate.
- Staking sUSDe: Offers 1x shard per day of stake, catering to those looking to engage directly with the stablecoin.
Despite the initial setup of four liquidity pools, the USDe-USDC pool quickly reached its capacity within a day, leaving three remaining pools: USDe-crvUSD, USDe-FRAX, and USDe-mkUSD, each with a $10 million limit, rapidly approaching full capacity. With $16.5 million still available across these pools, the opportunity for liquidity provision remains open, albeit filling fast.
How to Participate:
- Purchasing USDe: Users can convert stablecoins (USDC, USDT, DAI) or Ether into USDe on Ethena or via Curve for liquidity provision.
- Depositing in Pools: Participants can deposit USDe into one of the specified liquidity pools without the need for the paired currency.
- Locking LP Tokens: On Ethena’s Liquidity page, users can lock their LP tokens from the chosen USDe pair to start earning Shards.
Given the Ethereum network’s gas fees, an initial investment of at least $1000 is recommended to justify the costs, considering a 21-day lock period. This investment threshold and the platform’s current user base of 12,340 suggest a potentially substantial distribution for early participants.
For those less inclined to lock in their funds, simply purchasing and holding USDe in a wallet remains a viable option, offering 5x shards per day of hold with a minimal transaction fee for buying USDe on Ethena of approximately $11.
As Ethena progresses, its unique approach to stablecoin creation, backed by significant industry support and innovative participation incentives, positions it as a potentially dominant force in the decentralized finance (DeFi) landscape.