The Ethena (ENA) community has made a significant move by proposing to use Solana (SOL) as a reserve asset for its synthetic dollar, USDe. This proposal has caused ENA to surge by 17%, reaching $0.39, and pushing its market cap past $1.06 billion.
Improving Reserve Structure with Solana
The new proposal aims to strengthen USDe’s reserve structure by incorporating Solana as a reserve asset. This strategy follows a similar approach to Ethena’s previous hedging strategies for Bitcoin (BTC) and Ethereum (ETH). The goal is to diversify USDe’s reserve assets and expand its utility in the DeFi space, thereby increasing market liquidity.
In addition to Solana, the Ethena community has proposed using Binance Liquid Staked SOL (BNSOL) and Bybit Liquid Staked SOL (bbSOL) as reserve assets for USDe. These steps are designed to strengthen the synthetic dollar’s support system and enhance liquidity and market activity.
Impact on ENA’s Price
Earlier this year, Ethena launched the USDe stablecoin on the Solana Blockchain using LayerZero’s OFT standard. According to the Ethena Foundation, they will carefully scale Solana’s integration as a reserve asset, taking into account the risks associated with Solana’s perpetual futures, such as limited trading history and low liquidity.
The foundation stated, “The proposed allocation will be implemented gradually in consultation with the Risk Committee,” ensuring a controlled transition for a smoother process.
With this new reserve plan, Ethena aims to increase protocol revenue and unlock a $2-3 billion open position capacity with Solana-backed positions. This increased capacity will allow USDe to surpass its current supply of $2.5 billion, better meeting market demand.
Since its launch, USDe has attracted significant interest, reaching a $2.5 billion supply. As the first scalable, censorship-resistant stablecoin in the DeFi ecosystem, USDe maintains its dollar peg using delta hedging derivative positions.
Ethena is also expanding its ecosystem by partnering with BlockRock and Securitize to launch the UStb stablecoin, which further solidifies USDe’s position as a strong competitor in the stablecoin market.
ENA has also benefited from these developments. Last week, ENA’s price increased by 17%, reaching $0.39 and pushing its market cap back over $1 billion. On a weekly basis, ENA has risen by 28%, and technical analysis suggests the price could climb to $0.50 and $0.69. In more optimistic scenarios, $1.5 is within reach for the altcoin.
Ethena, USDe, Solana, ENA, stablecoin
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