Ethena Labs has introduced a new stablecoin, USDtb, backed by BlackRock’s USD Institutional Digital Liquidity Fund. 

USDtb operates similarly to other popular fiat-backed stablecoins like USD Coin (USDC) and Tether (USDT), with reserves held in cash or cash-equivalent assets at a 1:1 ratio.

Unlike most stablecoins, USDtb distinguishes itself by allocating 90% of its reserves to BlackRock’s BUIDL fund. This tokenized money market fund primarily invests in short-term U.S. Treasury bills, cash, and repurchase agreements.

This is the highest BUIDL allocation of any stablecoin, allowing USDtb to scale more effectively and providing a high degree of stability, according to Ethena (ENA). 

The stablecoin is being launched in partnership with Securitize, a leader in tokenization of real-world assets. USDtb is positioned as a more traditional stablecoin option, with a completely separate risk profile compared to Ethena’s flagship token, USDe (USDe), which uses a derivative-based strategy to maintain its peg to the U.S. dollar.

Ethena’s financial ecosystem 

The introduction of USDtb is part of Ethena’s broader strategy to bolster the resilience of its ecosystem, particularly during volatile market conditions. While USDe generates yield by shorting assets like Bitcoin (BTC), Ether (ETH), and Solana (SOL), it is susceptible to underperformance during market downturns and negative funding rates.

To mitigate these risks, Ethena’s Risk Committee has approved USDtb as a backup asset for USDe, allowing the platform to reallocate reserves when necessary. USDtb is also expected to serve as an alternative collateral option for margin trading on centralized exchanges, further broadening its utility.

Ethena has partnered with custodians such as Copper, Zodia Custody, Komainu, and Coinbase Institutional to secure USDtb’s reserves, according to the company.

Ethena also submitted an application for USDtb to be included in Sky’s $1 billion Tokenization Grand Prix, which aims to fund tokenized real-world asset projects.

The launch of USDtb follows a series of successful audits conducted by leading firms, including Pashov, Quantstamp, and Cyfrin, ensuring the token’s security and reliability.