Ethena Labs introduces sUSDe as collateral for Trump-backed WLFI protocol
Ethena Labs proposed integrating its synthetic stablecoin, sUSDe, into World Liberty Financial (WLFI) on Dec. 18.
The proposal stated that this partnership would boost capital efficiency and liquidity in WLFIs new Aave instance. The protocol is a credit market backed by President-elect Donald Trumps family.
The partnership comes as part of Ethenas broader mission to expand the utility of sUSDe, which has become the third-largest stablecoin with a $6.1 billion market cap, according to Artemis data.
Integrations across major DeFi protocols, including Aave, Curve, and Pendle, fueled the rise of the synthetic stablecoin. Additionally, sUSDe offers its holders a significant annual percentage yield (APY) of 27%.
According to the proposal, sUSDes role in Aaves existing markets has already proven its ability to amplify market conditions. Within a month of its onboarding to Aave Core and Lido instances, sUSDe achieved $1.2 billion in supplied assets, nearly doubling supply rates on over $5 billion of stablecoins like USD Coin (USDC) and Tether USD (USDT).
WLFI gaining traction
Should the proposal pass governance and the WLFI Aave instance go live, introducing sUSDe will enable WLFI to enhance users rewards due to the stablecoins high APY, grow its total value locked, and boost its revenue generation.
Additionally, Ethena will co-incentivize sUSDe deposits through its points program, offering additional rewards alongside WLFIs native WLF tokens.
Aaves risk service providers will oversee the deployment to ensure market stability and optimize liquidity.
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Text source: CryptoSlate
