On December 18, decentralized finance (DeFi) protocol Ethena announced a strategic partnership with Donald Trump-backed World Liberty Financial. This partnership aims to integrate Ethena’s sUSDe token, a staked version of its USDe ‘synthetic dollar’, with World Liberty Financial’s Aave instance.
Integrating sUSDe and WLF Tokens
The partnership will enable users to deposit USDe and receive rewards in both sUSDe and World Liberty’s WLF token. This integration is expected to increase stablecoin liquidity and utilization rates on the protocol, as sUSDe has already demonstrated its potential for growth with Aave’s Core instance.
Proposal to Onboard sUSDe
Ethena Labs Research submitted an official proposal to the World Liberty Financial community on December 18, asking for approval to implement sUSDe ‘as the first new collateral asset to the World Liberty Financial market.’ The Ethena Foundation states that it will "co-incentivize supply of sUSDe to come to the instance via its points program" to support the dual rewards stream for users.
Risk Analysis and Implementation
According to a post on the community forum, sUSDe has already passed risk analysis on the Aave Core and Lido instances. If the proposal is implemented, it will enable World Liberty Financial users to benefit from sUSDe rewards and also WLF token rewards.
The Trump Bump?
This partnership comes at a tumultuous time for World Liberty Financial, which has yet to find its footing among more established industry players. As Cointelegraph reported, the president-elect’s crypto business endeavor was something of a flop at its launch.
Early Adoption and Challenges
In its first 24 hours of trading after launching on October 16, only 848.63 million WLFI ($12.7 million worth based on the presale price) was sold, leaving an additional 19.1 billion coins (worth approximately $287 million) unsold.
Justin Sun’s Investment and Spending
On November 26, the company saw an influx of cash as Justin Sun, a cryptocurrency entrepreneur and somewhat controversial figure in the community, became World Liberty’s largest single tokenholder after purchasing $30 million worth of WLF. Less than a week after Sun’s purchase, the company went to work spending the capital with purchases of Ether (ETH), AAVE (AAVE), ENA (ENA), ONDO (ONDO), Chainlink (LINK), and cbBTC equaling roughly $30 million at the time of purchase.
Related Developments
- Ethena’s USDe Beats DAI to Become 3rd-Largest Stablecoin
- The Trump Bump: Can World Liberty Financial Rebound?
The Partnership’s Potential Impact
This partnership has the potential to increase stablecoin liquidity and utilization rates on the protocol. It also highlights the growing trend of DeFi protocols partnering with established industry players.
Ethena’s USDe
As mentioned earlier, Ethena’s USDe has already demonstrated its potential for growth with Aave’s Core instance. Its integration with World Liberty Financial’s Aave instance is expected to increase stablecoin liquidity and utilization rates on the protocol.
The Future of DeFi
This partnership showcases the growing trend of DeFi protocols partnering with established industry players. It also highlights the importance of stablecoins in the DeFi ecosystem.
Conclusion
The partnership between Ethena and World Liberty Financial has the potential to increase stablecoin liquidity and utilization rates on the protocol. It also highlights the growing trend of DeFi protocols partnering with established industry players. As the DeFi space continues to evolve, it will be interesting to see how this partnership impacts the market.
Recommendations
- Investors should keep an eye on Ethena’s USDe and its potential for growth.
- The integration of sUSDe with World Liberty Financial’s Aave instance is expected to increase stablecoin liquidity and utilization rates on the protocol.
- The partnership highlights the growing trend of DeFi protocols partnering with established industry players.
Glossary
- sUSDe: A staked version of Ethena’s USDe ‘synthetic dollar’.
- World Liberty Financial (WLF): A cryptocurrency endeavor backed by President-elect Donald Trump.
- Aave: A decentralized lending platform that allows users to lend and borrow cryptocurrencies.
Sources
- Ethena Labs: The official website of Ethena Labs, a DeFi protocol that offers a range of financial services.
- World Liberty Financial: The official website of World Liberty Financial, a cryptocurrency endeavor backed by President-elect Donald Trump.
